Your Down Payment

Many buyers can easily qualify for various loan programs, but they don't have a lot of money to pay the standard down payment. We have a few suggestions

Tighten your belt and save. Scrutinize the budget to discover ways you can cut expenses to save for your down payment. Also, you can look into bank programs in which a portion of your paycheck is automatically placed into a savings account each pay period. You would be wise to look into some big expenses in your budget that you can give up, or trim, at least temporarily. Here are a couple of examples: you might decide to move into less expensive housing, or skip a family vacation.

Sell items you do not need and get a part-time job. Perhaps you can find a second job to get your down payment money. Additionally, you can make an exhaustive inventory of things you may be able to sell. Broken gold jewelry can bring a good price from local jewelry stores. Multiple small items could add up to a fair amount at a garage or tag sale. You could also look into what any investments you hold could sell for.

Tap into your retirement funds. Explore the details of your individual plan. Many people get down payment money by withdrawing funds from Individual Retirement Accounts or borrowing from their 401(k) plans. Make sure you are knowledgable about any penalties, the effect this may have on taxes, and repayment obligation.

Ask for help from generous family members. Many buyers somtimes get help with their down payment assistance from caring parents and other family members who may be willing to help get them in their own home. Your family members may be willing to help you reach the milestone of owning your own home.

Contact housing finance agencies. Provisional mortgage programs are extended to buyers in specific situations, such as low income purchasers or future homeowners looking to improve homes in a targeted part of town, among others. With the help of a housing finance agency, you probably will be given a below market interest rate, down payment assistance and other advantages. Housing finance agencies can help eligible homebuyers with a lower interest rate, help with your down payment, and offer other assistance. These non-profit programs were established to boost home ownership in specific areas.

Explore no-down and low-down mortgage loan programs.

  • FHA mortgage loans

    The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in aiding low and moderate-income Americans qualify for mortgages. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) aids individuals in getting mortgages. FHA provides mortgage insurance to the private lenders, ensuring the buyers are eligible for financing. Down payment sums for FHA mortgages are below those of typical mortgages, even though these loans hold current rates of interest. Closing costs may be included in the mortgage, and your down payment might be as low as 3 percent of the total.

  • VA mortgages

    VA loans are backed by the U.S. Department of Veterans Affairs. Veterens and service people are eligible for a VA loan, which generally offers a reasonable rate of interest, no down payment, and limited closing costs. Even though the loans don't originate from the VA, the department verfifies applicants by providing eligibility certificates.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that you close with the first. Most of the time, the piggyback loan takes care of 10 percent of the home's amount, and the first mortgage finances 80 percent. Rather than the usual 20 percent down payment, the homebuyer just has to pull together the remaining 10 percent.

  • Carry-Back loans

    In a "carry back" situation, the seller commits to loan you a portion of his home equity to help you get your down payment money. In this scenario, you would finance the majority of the purchase price with a traditional mortgage lender and finance the remaining amount with the seller. Usually this kind of second mortgage will have a higher rate of interest.

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

Want to discuss your down payment? Give us a call at 952 417 8481.

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