Your Down Payment
Many buyers can easily qualify for several different kinds of mortgages, but they can't afford a large down payment. Do you want to look into getting a new home, but don't know how you should put together your down payment?
Tighten your belt and save. Be on the look-out for ways you can trim your expenses to save toward a down payment. There are bank programs through which some of your take-home pay is automatically transferred into a savings account each pay period. You might look into some big expenses in your spending history that you can give up, or reduce, at least temporarily. For example, you might decide to move into less expensive housing, or stay close to home for your family vacation.
Work more and sell things you do not need. Maybe you can get an additional job and save your earnings. In addition, you can put together an exhaustive list of items you can sell. Broken gold jewelry can bring a good price from local jewelry stores. A closetful of small things may add up to a fair amount at a garage or tag sale. Also, you might want to consider selling any investments you hold.
Borrow funds from your retirement plan. Research the details of your individual plan. Some homebuyers get down payment money from withdrawing from Individual Retirement Accounts or borrowing from 401(k) plans. Be sure you understand about any penalties, the way this could affect on your taxes, and repayment terms.
Ask for help from generous members of your family. Many homebuyers are sometimes fortunate enough to get down payment assistance from gracious family members who may be anxious to help get them in their first home. Your family members may be eager to help you reach the goal of having your first home.
Learn about housing finance agencies. Special loan programs are offered to buyers in specific situations, such as low income homebuyers or homebuyers planning to renovating houses in a certain place, among others. Working with a housing finance agency, you can get an interest rate that is below market, down payment assistance and other perks. These types of agencies can help you with a reduced rate of interest, get you your down payment, and offer other assistance. The principal purpose of non-profit housing finance agencies is to boost the purchase of homes in targeted areas.
Explore no-down and low-down mortgage loans.
- Federal Housing Administration (FHA) mortgages
The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays a significant part in helping low and moderate-income Americans qualify for mortgage loans. Part of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists individuals who need to get mortgages.
FHA helps first-time homebuyers and others who may not be able to qualify for a traditional loan on their own, by offering mortgage insurance to lenders.
Interest rates with an FHA loan usually feature the going interest rate, while the down payment with an FHA mortgage are lower than those of conventional loans. Closing costs might be financed in the mortgage, while your down payment may be as low as 3% of the total.
- VA mortgage loans
VA loans are guaranteed by the Department of Veterans Affairs. Veterens and service people can get a VA loan, which generally offers a low rate of interest, no down payment, and reduced closing costs. Even though the mortgages aren't actually issued by the VA, the office certifies borrowers by providing eligibility certificates.
- Piggy-back loans
A piggy-back loan is a second mortgage that you close with the first. Often the first mortgage covers 80% of the cost of the home and the "piggyback" funds 10%. The homebuyer pays the remaining 10%, instead of needing to put together the usual 20% down payment.
- Carry-Back loans
In a "carry back" situation, the seller agrees to lend you a portion of his home equity to assist you with your down payment money. You would borrow the majority of the purchase price from a traditional lender and borrow the remainder from the seller. Usually you'll pay a slightly higher interest rate with the loan financed by the seller.
The feeling of accomplishment will be the same, no matter which strategy you use to come up with the down payment. Your new home will be worth it!
Need to talk about your down payment? Call us: 3149139678.
Quick and Easy Pre-Qualication
Fill out the form below, it will take you 2 minutes, for a quick and easy mortgage pre-qualification. I will examine your information for qualified mortgage programs, down payment assistance, and more! You will have answers to you questions plus I will email you an individualized assessment based on the information you provided. I will personally work on this assessment for you, please allow me 1 to 2 business days to complete and respond.