Your Down Payment

Many buyers can qualify for a mortgage loan, but they don't have much to pay the standard down payment. We have a few suggestions

Slash your budget and build up savings. Look for ways to trim your expenses to put away money for a down payment. Also, you can look into bank programs through which a specific portion of your take-home pay is automatically deposited into a savings account every pay period. You could look into some big expenses in your spending history that you can do without, or trim, at least temporarily. Here are a couple of examples: you may move into less expensive housing, or skip a vacation.

Sell items you do not need and find a second job. Maybe you can get a second job and build up your earnings. You can also get serious about the possessions you actually need and the things you can sell. Multiple small items may add up to a nice sum at a garage or tag sale. Also, you can look into selling any investments you hold.

Borrow from your retirement funds. Explore the details for your particular plan. You can pull out money from a 401(k) plan for a down payment or make a withdrawal from an Individual Retirement Account. Be sure you are knowledgable about any penalties, the way this may affect on your income taxes, and repayment obligation.

Ask for help from family members. First-time buyers are often fortunate enough to receive down payment help from caring parents and other family members who are anxious to help get them in their first home. Your family members may be pleased to help you reach the goal of having your own home.

Research housing finance agencies. Provisional mortgate loan programs are given to buyers in specific circumstances, such as low income buyers or buyers looking to improve homes in a particular place, among others. With the help of a housing finance agency, you probably will get an interest rate that is below market, down payment help and other advantages. Housing finance agencies may help you with a lower interest rate, get you your down payment, and provide other advantages. These non-profit agencies exist to build up community in specific areas.

Research no-down and low-down mortgages.

• FHA loans

  The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays a vital part in aiding low and moderate-income buyers qualify for mortgage loans. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) aids homebuyers in qualifying for mortgages. FHA aids first-time buyers and others who would not be eligible for a traditional mortgage loan by themselves, by providing mortgage insurance to the lenders. Interest rates with an FHA mortgage are typically the market interest rate, while the down payment with an FHA loan are smaller than those of conventional loans. Closing costs can be financed within the mortgage, while your down payment can be as low as 3% of the total.

• VA loans

  With a guarantee from the Department of Veterans Affairs, a VA loan assists veterens and service people. This special loan does not require a down payment, has mimimal closing costs, and provides the advantage of a competitive rate of interest. Although the VA does not actually issue the loans, it does certify eligibility to qualify for a VA loan.

• Piggy-back loans

  A piggy-back loan is a second mortgage that you close with the first. Generally the piggyback loan takes care of 10 percent of the home's price, and the first mortgage covers 80 percent. Rather than the traditional 20 percent down payment, the buyer just has to cover the remaining 10 percent.

• Carry-Back loans

  In a "carry back" mortgage, the seller agrees to lend you a piece of his own equity to assist you with your down payment money. The buyer funds most of the purchase price through a traditional mortgage program and finances the remaining funds with the seller. Typically, this form of second mortgage will have higher interest.

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

Want to discuss your down payment? Give us a call at 7068605514.