Your Down Payment

Many buyers qualify for several different kinds of mortgages, but they don't have a lot of cash to put up the standard down payment. Below are a few straightforward methods that will help you get together your down payment

Tighten your belt and save. Be on the look-out for ways you can reduce your expenses to save toward a down payment. You also could enroll in an automatic savings plan to automatically have a set portion of your take-home pay moved into savings. Some practical approaches to build up funds include moving into less expensive housing, and staying local for your family vacation this year.

Sell items you do not need and find a second job. Perhaps you can find an additional job to get your down payment money. You can also get creative about the things you can put up for sale. Maybe you have desirable items you can sell at an auction website, or quality household goods for a tag or garage sale. You can also research what your investments may sell for.

Tap into retirement funds. Investigate the parameters of your particular program. Many people get down payment money by withdrawing from their IRAs or borrowing from their 401(k) programs. Be sure to ask your plan representative about the tax consequences, your obligation for repayment, and possible penalties for withdrawing early.

Ask for assistance from members of your family. Many homebuyers somtimes receive down payment assistance from thoughtful family members who may be prepared to help them get into their own home. Your family members may be eager to help you reach the milestone of owning your own home.

Contact housing finance agencies. These types of agencies provide provisional loan programs to moderate and low income borrowers, buyers with an interest in remodeling a home in a targeted area, and other certain kinds of buyers as specified by the finance agency. With the help of a housing finance agency, you may get a below market interest rate, down payment assistance and other advantages. Housing finance agencies may help you with a reduced rate of interest, help with your down payment, and offer other assistance. The principal purpose of non-profit housing finance agencies is boosting home ownership in specific parts of the city.

Find out about low-down and no-down mortgage loan programs.

  • Federal Housing Administration (FHA) loans

    The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays a vital role in aiding low and moderate-income buyers get mortgages. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA provides mortgage insurance to private lenders, enabling new homebuyers who may not qualify for a typical mortgage, to get a mortgage. Down payment totals for FHA loans are less than those with traditional mortgages, even though these mortgages come with current interest rates. Closing costs might be financed within the mortgage, and your down payment could be as low as 3 percent of the total amount.

  • VA loans

    Guaranteed by the Department of Veterans Affairs, a VA loan assists veterens and service people. This specialized loan does not require a down payment, has limited closing costs, and offers a competitive interest rate. While it's true that the mortgage loans don't originate from the VA, the office certifies applicants by issuing eligibility certificates.

  • Piggy-back loans

    You can finance a down payment using a second mortgage that closes with the first. Generally the piggyback loan takes care of 10 percent of the home's amount, while the first mortgage covers 80 percent. In contrast to the usual 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 portion of his home equity to help you get your down payment funds. The buyer finances most of the purchase price through a traditional mortgage program and finances the remaining funds with the seller. Often, this form of second mortgage will have higher interest.

No matter how you gather your down payment, the satisfaction of living in your own home will be just as great!

Need to talk about down payment options? Call us at (303) 228-2254.

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