Your Down Payment
Shopping for a mortgage loan? We'll be glad to discuss your mortgage needs! Give us a call today at 888-365-2023. Want to get started? Apply Here
Lots of borrowers qualify for various loan programs, but they don't have a lot of cash to pay the standard down payment. Below are a few straightforward ways to get together your down payment
Tighten your belt and save. Look for ways to trim your monthly expenses to set aside funds for a down payment. There are bank programs in which a specific portion of your paycheck is automatically placed into savings each pay period. You could look into some big expenses in your budget that you can do without, or reduce, at least temporarily. Here are a couple of examples: you may move into less expensive housing, or skip a vacation.
Work more and sell items you don't need. Perhaps you can find an additional job to get your down payment money. You can also get creative about the items you can sell. Multiple small items could add up to a nice sum at a garage or tag sale. Also, you might want to consider selling any investments you hold.
Borrow from retirement funds. Check the parameters of your specific program. It is possible to take out money from a 401(k) for a down payment or withdraw from an Individual Retirement Account. Be sure you know about any penalties, the effect this will have on taxes, and repayment obligation.
Ask for a gift from family. First-time buyers sometimes receive down payment help from thoughtful parents and other family members who are prepared to help them get into their own home. Your family members may be inclined to help you reach the goal of having your first home.
Contact housing finance agencies. These agencies offer provisional loan programs for low and moderate-income borrowers, buyers with an interest in sprucing up a home in a particular part of the city, and other groups as defined by each agency. With the help of a housing finance agency, you may receive a below market interest rate, down payment assistance and other incentives. These kinds of agencies can assist eligible buyers with a reduced rate of interest, get you your down payment, and offer other benefits. The primary goal of non-profit housing finance agencies is to promote residence ownership in specific places.
Explore no-down and low-down mortgage loans.
- Federal Housing Administration (FHA) mortgage loans
The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays a significant part in helping low and moderate-income families qualify for mortgage loans. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) aids homebuyers in getting mortgages.
FHA offers mortgage insurance to private lenders, making the buyers eligible for financing.
Down payment requirements for FHA mortgages are below those of traditional mortgage loans, even though these loans have current rates of interest. The required down payment can go as low as 3 percent and the closing costs could be covered by the mortgage.
- VA mortgage loans
VA loans are backed by the Department of Veterans Affairs. Service persons and veterans can benefit from a VA loan, which typically offers a competitive fixed interest rate, no down payment, and reduced closing costs. Although the loans are not actually provided by the VA, the office verifies borrowers by issuing eligibility certificates.
- Piggy-back loans
You can finance your down payment using a second mortgage that closes at the same time as the first. Most of the time, the piggyback loan is for 10 percent of the home's price, while the first mortgage finances 80 percent. The homebuyer pays the remaining 10%, rather than needing to put together the typical 20% down payment.
- Carry-Back loans
We a seller carries back a second mortgage, the you borrow part of the seller's home equity.. You would finance the largest portion of the purchase price with a traditional mortgage lending institution and finance the remainder with the seller. Generally, this kind of second mortgage has higher interest.
The satisfaction will be the same, no matter which method you use to come up with the down payment. Your new home will be worth it!
Need to talk about down payments? Call us: 888-365-2023.