Your Down Payment

Many borrowers can qualify for various loan programs, but they don't have a lot of money to put up the standard down payment. We have a few ideas

Tighten your belt and save. Turn your budget inside out to find ways you can cut expenses to save for your down payment. Also, you can look into bank programs in which some of your paycheck is automatically placed into savings every pay period. Some effective ways to build up funds include moving into a residence that is less expensive, and staying home for your vacation for a year or two.

Work a second job and sell things you don't need. Maybe you can find a second job to get your down payment money. In addition, you can put together an exhaustive list of things you can sell. Unused gold jewelry can bring a good price from local jewelers. A closetful of small items might add up to a nice sum at a garage or tag sale. Also, you can consider selling any investments you hold.

Borrow funds from a retirement plan. Explore the details for your individual plan. Some people get down payment money from withdrawing what they need from IRAs or borrowing from their 401(k) programs. Make sure you understand the tax consequences, your obligation for repaying the money, and any early withdrawal penalties.

Ask for assistance from family members. Many homebuyers somtimes get down payment help from caring parents and other family members who are prepared to help them get into their own home. Your family members may be willing to help you reach the goal of having your first home.

Contact housing finance agencies. Special mortgage loans are provided to homebuyers in certain situations, such as low income purchasers or buyers planning to renovating houses in a certain place, among others. Financing with this type of agency, you may be given an interest rate that is below market, down payment help and other perks. These types of agencies may help eligible homebuyers with a reduced rate of interest, get you your down payment, and provide other assistance. The central purpose of not-for-profit housing finance agencies is to promote the purchase of homes in particular areas.

Find out about low-down and no-down mortgage loans.

• FHA loans

  The Federal Housing Administration (FHA), which is part of the U.S. Department of Housing and Urban Development (HUD), plays an important role 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 wish to get home financing. FHA helps first-time homebuyers and others who may not be able to qualify for a traditional mortgage loan on their own, by providing mortgage insurance to the lenders. Down payment requirements for FHA mortgages are below those for conventional mortgages, even though these mortgages come with average interest rates. Closing costs might be covered by the mortgage, while your down payment could be as low as 3% of the purchase price.

• VA loans

  VA loans are guaranteed by the U.S. Department of Veterans Affairs. Service persons and veterans can benefit from a VA loan, which generally offers a low fixed interest rate, no down payment, and reduced closing costs. Even though the VA doesn't actually finance the mortgages, it does certify eligibility to qualify for a VA loan.

• Piggy-back loans

  A piggy-back loan is a second mortgage that closes with the first. Generally the piggyback loan is for 10 percent of the home's amount, while the first mortgage covers 80 percent. The homebuyer pays the remaining 10%, rather than putting the typical 20% down payment.

• Carry-Back loans

  In a "carry back" situation, the seller agrees to loan you a portion of his own equity to help you get your down payment funds. The buyer funds the majority of the purchase price through a traditional mortgage program and borrows the remaining funds from the seller. Usually you'll pay a slightly higher rate on the loan financed by the seller.

Want to discuss your down payment? Give us a call: 5122916100.