Your Down Payment

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

Cut expenses and save. Turn your budget inside out to uncover ways you can cut expenses to save for your down payment. You also could enroll in an automatic savings plan at your bank to have a percentage of your pay automatically transferred into savings. You would be wise to look into some big expenses in your spending history that you can give up, or reduce, at least temporarily. For example, you may decide to move into less expensive housing, or skip a vacation.

Sell things you don't really need and get a second job. Try to get a second job. This can be rough, but the temporary difficulty can provide your down payment money. In addition, you can put together a comprehensive list of things you can sell. Unused gold jewelry can be sold at local jewelry stores. Maybe you have collectibles you can sell at an auction website, or household items for a garage or tag sale. Also, you can look into selling any investments you own.

Tap into your retirement funds. Investigate the parameters of your specific plan. Some people get down payment money from withdrawing from their Individual Retirement Accounts or borrowing from 401(k) plans. You will want to ensure you are clear about any penalties, the way this may affect on taxes, and repayment terms.

Ask for a gift from your family. Many homebuyers are often fortunate enough to get help with their down payment assistance from gracious family members who are anxious to help them get into their first home. Your family members may be willing to help you reach the goal of having your first home.

Contact housing finance agencies. Provisional mortgage loans are given to homebuyers in certain situations, such as low income buyers or buyers planning to improve homes in a particular place, among others. With the help of a housing finance agency, you may receive an interest rate that is below market, down payment assistance and other incentives. These types of agencies may help eligible buyers with a lower interest rate, help with your down payment, and offer other assistance. The primary goal of non-profit housing finance agencies is build up home ownership in targeted areas.

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

• Federal Housing Administration (FHA) mortgages

  The Federal Housing Administration (FHA), which is part of the U.S. Department of Housing and Urban Development (HUD), plays an important part in aiding low and moderate-income families get mortgage loans. Part of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists homebuyers who wish to get mortgage loans. FHA provides mortgage insurance to private lenders, making the buyers eligible for a loan. Interest rates for an FHA mortgage are usually the market interest rate, but the down payment amounts with an FHA loan will be less than those of conventional loans. The required down payment can be as low as three percent while the closing costs can be packaged in the mortgage.

• VA mortgage loans

  VA loans are backed by the U.S. Department of Veterans Affairs. Veterens and service people can benefit from a VA loan, which generally offers a reasonable fixed rate of interest, no down payment, and limited closing costs. Although the VA doesn't actually issue the mortgages, it does issue a certificate of eligibility to apply for a VA loan.

• Piggy-back loans

  You may finance your down payment through 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 finances 80 percent. In contrast to the usual 20 percent down payment, the homebuyer just has to pull together the remaining 10 percent.

• Carry-Back loans

  With a carry-back mortgage, the you borrow a portion of the seller's home equity.. The buyer finances most of the purchase price through a traditional mortgage program and borrows the remainder from the seller. Generally, this type of second mortgage will have higher interest.

No matter your method of getting together your down payment, the thrill of reaching the goal of living in your own home will be just as great!

Want to discuss down payments? Give us a call: 866-300-1550.