Your Down Payment

Lots of buyers can easily qualify for several different kinds of mortgages, but they don't have a lot of cash to put up the standard down payment. Get started here

Reduce expenses and save. Be on the look-out for ways to reduce your monthly expenses to set aside funds for a down payment. Also, you can look into bank programs through which a portion of your take-home pay is automatically placed into savings each pay period. Some practical ways to save additional funds include moving into housing that is less expensive, and staying home for your family vacation for a year or two.

Sell things you do not need and get a part-time job. Try to get a second job. This can be exhausting, but the temporary difficulty can provide your down payment money. Additionally, you can put together a comprehensive list of things you may be able to sell. Unused gold jewelry can be sold at local jewelers. A closetful of small items might add up to a fair amount at a garage or tag sale. Also, you might want to think about selling any investments you hold.

Borrow from your retirement funds. Investigate the parameters of your particular program. You can take out funds from a 401(k) for you down payment or get a withdrawal from an IRA. You will need to ensure you know about any penalties, the effect this will have on your income taxes, and repayment terms.

Ask for assistance from generous members of your family. Many homebuyers are sometimes lucky enough to get help with their down payment help from giving parents and other family members who are willing to help get them in their first home. Your family members may be willing to help you reach the milestone of having your own home.

Research housing finance agencies. Special mortgage programs are provided to buyers in specific situations, like low income homebuyers or future homeowners planning to renovating homes in a specific place, among others. With the help of this type of agency, you probably will be given an interest rate that is below market, down payment help and other advantages. These kinds of agencies can help eligible buyers with a lower interest rate, get you your down payment, and provide other benefits. These non-profit programs to boost home ownership in specific neighborhoods.

Learn about low-down and no-down mortgage loan programs.

  • FHA mortgage loans

    The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays a significant role in assisting low and moderate-income families qualify for mortgages. Part of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) aids individuals who wish to qualify for mortgages. FHA offers mortgage insurance to private lenders, enabling new homebuyers who might not qualify for a traditional loan, to obtain a mortgage. Down payment requirements for FHA mortgages are smaller than those for traditional mortgages, although these loans come with current rates of interest. Closing costs can be covered by the mortgage, and the down payment might be as low as 3 percent of the total.

  • VA loans

    Guaranteed by the Department of Veterans Affairs, a VA loan assists service people and veterans. This special loan requires no down payment, has limited closing costs, and provides the advantage of a competitive rate of interest. While the VA does not actually finance the loans, it does certify eligibility to qualify for a VA loan.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that closes along with the first. Generally the first mortgage covers 80% of the purchase amount and the "piggyback" is for 10%. The homebuyer covers the remaining 10%, instead of needing to put together the typical 20% down payment.

  • Carry-Back loans

    In the option of the seller "carrying back a second mortgage," the seller loans you part of his or her equity. The buyer funds most of the purchase price with a traditional mortgage program and borrows the remainder from the seller. Usually you will pay a somewhat higher rate with the loan financed by the seller.

The feeling of accomplishment will be the same, no matter which approach you use to put together your down payment. Your brand new home will be worth it!

Need to talk about down payment options? Give us a call at 3149139678.


Bob Rutledge Mortgage

Loan Officer NMLS#: 297044

New American Funding 12321 Olive Blvd, ste 150
St. Louis, MO 63141