Your Down Payment

Many buyers can easily qualify for several different kinds of mortgages, but they can't afford a large down payment. Want to buy a new home, but don't know how to get together a down payment?

Tighten your belt and save. Look for ways to trim your expenses to set aside funds for a down payment. You may also decide to enroll in an automatic savings plan to automatically have a specific portion of your take-home pay moved into a savings account. Some effective ways to save additional funds include moving into less expensive housing, and skipping a year's vacation.

Work more and sell things you don't need. Try to find an additional job. This can be exhausting, but the temporary trial can provide your down payment money. Additionally, you can put together a comprehensive list of things you may be able to sell. Broken gold jewelry can bring a good price from local jewelers. Multiple small things can add up to a nice sum at a garage or tag sale. You can also look into what your investments could sell for.

Borrow from a retirement plan. Research the details for your particular plan. Many homebuyers get down payment money from withdrawing what they need from their Individual Retirement Accounts or borrowing from 401(k) programs. Be sure you understand about any penalties, the way this could affect on your income taxes, and repayment obligation.

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

Learn about housing finance agencies. Provisional mortgate loan programs are provided to homebuyers in certain situations, like low income purchasers or buyers looking to renovating houses in a particular part of town, among others. With the help of this kind of agency, you probably will receive a below market interest rate, down payment help and other incentives. These kinds of agencies may assist you with a lower rate of interest, help with your down payment, and provide other advantages. These non-profit agencies exist to boost the value of homes in certain areas.

Explore no-down and low-down mortgages.

• FHA mortgage loans

  The Federal Housing Administration (FHA), which is inside the U.S. Department of Housing and Urban Development (HUD), plays a vital role in helping low to moderate-income buyers qualify for mortgage loans. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists homebuyers in getting home financing. FHA offers mortgage insurance to private lenders, ensuring the buyers are eligible for financing. Down payment sums for FHA mortgages are smaller than those of conventional mortgage loans, although these loans hold average interest rates. Closing costs can be covered by the mortgage, and the down payment may be as low as 3 percent of the purchase price.

• VA mortgages

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

• Piggy-back loans

  A piggy-back loan is a second mortgage that closes with the first. Often the first mortgage covers 80% of the cost of the home and the "piggyback" funds 10%. Rather than the traditional 20 percent down payment, the homebuyer will just have to cover the remaining 10 percent.

• Carry-Back loans

  In a "carry back" situation, the seller commits to lend you a piece of his home equity to help you with your down payment money. In this scenario, you would finance the largest portion of the purchase price with a traditional mortgage lender and borrow the remainder from the seller. Typically you will pay a somewhat higher interest rate with the loan financed by the seller.

No matter your method of getting together down payment money, the satisfaction of owning your own home will be just as great!

Want to discuss the best options for down payments? Give us a call at 5623200510.