Your Down Payment

Many folks who are looking to purchase a new home can easily qualify for several different kinds of mortgages, but they can't afford a large down payment. We have a few ideas

Reduce expenses and save. Look for ways you can trim your expenses to save toward a down payment. Also, you can look into bank programs through which some of your take-home pay is automatically transferred into a savings account every pay period. Some practical strategies to put together funds include moving into housing that is less expensive, and skipping a year's vacation.

Work more and sell things you don't need. Look for a second job. This can be exhausting, but the temporary difficulty can help you get your down payment. You can also get creative about the things you can sell. Multiple small items could add up to a fair amount at a garage or tag sale. Also, you can think about selling any investments you hold.

Borrow funds from your retirement plan. Check the provisions of your retirement program. It is possible to take out funds from a 401(k) for you down payment or withdraw from an Individual Retirement Account. You will want to ensure you are knowledgable about any penalties, the effect this will have on income taxes, and repayment obligation.

Ask for assistance from generous family members. First-time buyers are often lucky enough to get down payment assistance from thoughtful family members who may be eager to help them get into their own home. Your family members may be happy at the chance to help you reach the milestone of buying your first home.

Contact housing finance agencies. These agencies offer special mortgage programs for moderate and low income borrowers, buyers with an interest in rehabilitating a home within a specific area, and additional groups as specified by the finance agency. With the help of this type of agency, you may get a below market interest rate, down payment assistance and other perks. These types of agencies may assist eligible buyers with a reduced rate of interest, help with your down payment, and offer other assistance. These non-profit programs were established to boost the value of homes in specific areas.

Explore no-down and low-down mortgage loans.

  • FHA loans

    The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in helping low to moderate-income Americans get mortgages. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA helps first-time buyers and others who may not be able to qualify for a typical mortgage loan on their own, by offering mortgage insurance to private lenders. Interest rates with an FHA mortgage are normally the market interest rate, while the down payment for an FHA loan are below those of conventional loans. The required down payment can be as low as three percent and the closing costs can be financed in the mortgage.

  • VA loans

    Guaranteed by the Department of Veterans Affairs, a VA loan assists veterens and service people. This specialized loan does not require a down payment, has limited closing costs, and provides a competitive interest rate. While the VA doesn't actually provide the mortgages, it does issue a certificate of eligibility to apply for a VA mortgage.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that you close along with the first. Most of the time, the piggyback loan is for 10 percent of the purchase amount, while the first mortgage finances 80 percent. The borrower pays the remaining 10%, instead of having to put together the usual 20% down payment.

  • Carry-Back loans

    In the case of the seller "carrying back a second mortgage," the you borrow a portion of the seller's home equity.. You would borrow the largest portion of the purchase price from a traditional lender and finance the remainder with the seller. Generally, this form of second mortgage has higher interest.

No matter how you gather down payment funds, the thrill of reaching the goal of owning your own home will be just as great!

Need to talk about the best options for down payments? Give us a call at (772) 252-6724.