Your Down Payment

Many people who would like to purchase a new house qualify for several different kinds of mortgages, but they can't afford a large down payment. Here are a few methods that will help you put together a down payment

Slash the budget and build up savings. Turn your budget upside-down to find ways you can cut expenses to save for your down payment. You might also try enrolling in an automatic savings plan to have a percentage of your pay automatically transferred into savings. Some effective methods to build up funds include moving into less expensive housing, and skipping your vacation for a year or two.

Sell things you do not need and get a part-time job. Look for an additional job. This can be exhausting, but the temporary trial can provide your down payment money. In addition, you can make an exhaustive list of items you can sell. Unused gold jewelry can be sold at local jewelry stores. A closetful of small items could add up to a nice sum at a garage or tag sale. You might also explore what any investments you have may bring if sold.

Borrow money from a retirement plan. Investigate the provisions of your specific program. Many people get down payment money from withdrawing what they need from IRAs or pulling money out of their 401(k) programs. Make sure you understand the tax ramifications, repayment terms, and any penalties for withdrawing early.

Ask for a generous gift from your family. Many buyers somtimes get help with their 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 pleased to help you reach the milestone of owning your own home.

Contact housing finance agencies. Provisional mortgate loan programs are offered to homebuyers in specific situations, like low income homebuyers or buyers looking to improve homes in a certain neighborhood, among others. Financing through this type of agency, you probably will get an interest rate that is below market, down payment assistance and other perks. Housing finance agencies may assist eligible buyers with a lower interest rate, get you your down payment, and offer other advantages. The principal mission of not-for-profit housing finance agencies is to boost residential ownership in targeted places.

Learn about low-down and no-down mortgage loan programs.

• 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 assisting low and moderate-income families get mortgages. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists homebuyers who wish to qualify for home financing. FHA provides mortgage insurance to private lenders, enabling new homebuyers who will not be eligible for a typical loan, to obtain home financing. Down payment amounts for FHA loans are smaller than those of traditional mortgage loans, even though these mortgages hold current interest rates. The required down payment may be as low as 3 percent and the closing costs might be covered by the mortgage.

• VA mortgage loans

  VA loans are guaranteed by the Department of Veterans Affairs. Veterens and service people can get a VA loan, which usually offers a competitive fixed interest rate, no down payment, and minimal closing costs. Although the loans don't originate from the VA, the office certifies borrowers by providing eligibility certificates.

• Piggy-back loans

  A piggy-back loan is a second mortgage that you close with the first. Generally the piggyback loan takes care of 10 percent of the home's amount, and the first mortgage finances 80 percent. In contrast to the traditional 20 percent down payment, the buyer will just have to pull together the remaining 10 percent.

• Carry-Back loans

  With a carry-back mortgage, the seller loans you part of his or her equity. You would borrow the largest portion of the purchase price from a traditional mortgage lender and finance the remaining amount with the seller. Usually you'll pay a slightly higher interest rate with the loan financed by the seller.

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

Want to discuss down payments? Give us a call at 7072522700.