Your Down Payment

Lots of buyers can easily qualify for various loan programs, but they don't have a lot of cash to put up the standard down payment. Do you want to look into getting a new house, but don't know how you should put together a down payment?

Cut expenses and save. Look for ways to reduce your monthly expenses to set aside funds for a down payment. You might also try enrolling in an automatic savings plan to have a portion of your pay automatically deposited into a savings account. Some effective approaches to build up funds include moving into housing that is less expensive, and staying home for your vacation for a year or two.

Sell items you do not need and get a second job. Maybe you can get a second job and save your earnings. Additionally, you can make an exhaustive list of things you can sell. Unworn gold jewelry can be sold at local jewelry stores. A closetful of small things can add up to a fair amount at a garage or tag sale. Also, you might want to look into selling any investments you hold.

Tap into retirement funds. Check the provisions of your particular program. Many people get down payment money by withdrawing what they need from their IRAs or getting funds out of 401(k) programs. Make sure you comprehend the tax ramifications, your obligation for repaying the money, and penalties for withdrawing early.

Request a generous gift from your family. First-time buyers somtimes receive down payment help from giving family members who are able to help them get into their first home. Your family members may be pleased to help you reach the milestone of buying your own home.

Research housing finance agencies. Provisional mortgage loans are given to buyers in certain situations, like low income buyers or people looking to renovating homes in a particular area, among others. With the help of this kind of agency, you can be given a below market interest rate, down payment help and other perks. Housing finance agencies may assist you with a reduced interest rate, help with your down payment, and provide other assistance. These non-profit agencies to boost community in certain neighborhoods.

Learn about low-down and no-down mortgages.

• Federal Housing Administration (FHA) mortgages

  The Federal Housing Administration (FHA), which is inside the U.S. Department of Housing and Urban Development (HUD), plays an important part in helping low and moderate-income families qualify for mortgage loans. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA assists first-time homebuyers and others who might not be able to qualify for a conventional mortgage on their own, by providing mortgage insurance to the lenders. Interest rates with an FHA loan typically feature the going interest rate, while the down payment for an FHA mortgage are smaller than those of conventional loans. Closing costs can be covered by the mortgage, and the down payment may be as low as 3% of the purchase price.

• VA mortgages

  Guaranteed by the Department of Veterans Affairs, a VA loan is offered to service people and veterans. This specialized loan requires no down payment, has limited closing costs, and provides a competitive interest rate. Although the VA doesn't issue the mortgages, it does certify eligibility to qualify for a VA loan.

• Piggy-back loans

  You can finance a down payment through a second mortgage that closes at the same time as the first. Often the first mortgage covers 80% of the purchase price and the "piggyback" funds 10%. Instead of the usual 20 percent down payment, the buyer will just have to pull together the remaining 10 percent.

• Carry-Back loans

  In a "carry back" situation, the seller commits to loan you some of his own equity to help you get your down payment funds. In this scenario, you would finance the majority of the purchase price with a traditional lender and finance the remaining amount with the seller. Typically, this type of second mortgage has higher interest.

The satisfaction will be the same, no matter which strategy you use to come up with your down payment. Your brand new home will be your reward!

Want to discuss down payment options? Give us a call: 9094671090.