Your Down Payment

Lots of people who are looking to buy a new home qualify for several different kinds of mortgages, but they don't have a lot of money to pay the standard down payment. Get started here

Reduce expenses and save. Turn your budget inside out to discover ways you can cut expenses to go toward your down payment. You also might enroll in an automatic savings plan at your bank to automatically have a predetermined amount from your take-home pay transferred into a savings account. You might look into some big expenses in your budget that you can give up, or trim, at least temporarily. For example, you might move into less expensive housing, or stay local for your family vacation.

Work more and sell items you don't need. Try to get a second job. This can be exhausting, but the temporary trial can help you get your down payment. You can also get creative about the things you can sell. Multiple small items may add up to a fair amount at a garage or tag sale. You could also look into what any investments you own will bring if sold.

Borrow money from a retirement plan. Research the details for your particular plan. Many people get down payment money by withdrawing from IRAs or borrowing from their 401(k) plans. Be sure you comprehend the tax consequences, repayment terms, and possible penalties for withdrawing early.

Request a gift from family. First-time buyers somtimes get help with their down payment help from thoughtful family members who may be prepared to help get them in their own home. Your family members may be eager to help you reach the goal of buying your own home.

Learn about housing finance agencies. Special loan programs are extended to homebuyers in certain circumstances, such as low income purchasers or people planning to renovating homes in a specific area, among others. Working through this kind of agency, you can be given an interest rate that is below market, down payment assistance and other perks. These kinds of agencies can assist eligible buyers with a lower interest rate, get you your down payment, and offer other advantages. The main mission of not-for-profit housing finance agencies is build up the purchase of homes in particular parts of the city.

Research no-down and low-down mortgages.

• Federal Housing Administration (FHA) loans

  The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in aiding low to moderate-income buyers qualify for mortgage loans. Part of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA offers mortgage insurance to private lenders, enabling buyers who will not qualify for a conventional loan, to receive financing. Down payment amounts for FHA mortgages are lower than those with conventional mortgages, even though these loans hold average interest rates. The required down payment may go as low as three percent while the closing costs might be covered by the mortgage.

• VA mortgages

  With a guarantee from the Department of Veterans Affairs, a VA loan assists service people and veterans. This specialized loan requires no down payment, has mimimal closing costs, and offers a competitive interest rate. While the VA does not finance the mortgages, it does certify eligibility to apply for a VA loan.

• Piggy-back loans

  A piggy-back loan is a second mortgage that you close with the first. Usually the first mortgage is for 80% of the cost of the home and the "piggyback" funds 10%. Instead of the usual 20 percent down payment, the buyer will just have to cover the remaining 10 percent.

• Carry-Back loans

  In the option of the seller "carrying back a second mortgage," the you borrow a portion of the seller's home equity.. The buyer funds the majority of the purchase price through a traditional mortgage program and borrows the remaining funds from the seller. Usually this type of second mortgage has higher interest.

Need to talk about the best options for down payments? Call us: 7193576601.