Putting Together Your Down Payment

Many buyers can easily qualify for various loan programs, but they don't have much to put up the standard down payment. Here are a few straightforward methods that will help you put together your down payment

Tighten your belt and save. Look for ways to trim your expenses to put away money for a down payment. You could also try enrolling in an automatic savings plan at your bank to have a percentage of your payroll automatically deposited into savings. You could look into some big expenses in your budget that you can give up, or trim, at least temporarily. Here are a couple of examples: you might decide to move into less expensive housing, or stay local for your family vacation.

Work more and sell items you do not need. Maybe you can get an additional job and build up your earnings. Additionally, you can put together a comprehensive inventory of items you can sell. Unworn gold jewelry can be sold at local jewelry stores. A closetful of small things can add up to a nice sum at a garage or tag sale. You might also research what any investments you own may bring if sold.

Tap into your retirement funds. Explore the specifics for your individual plan. You can pull out funds from a 401(k) for you down payment or withdraw from an IRA. Be sure you are clear about any penalties, the way this may affect on income taxes, and repayment terms.

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

Learn about housing finance agencies. Provisional mortgate loan programs are offered to buyers in certain situations, such as low income purchasers or homebuyers planning to renovating houses in a targeted place, among others. With the help of this kind of agency, you can receive an interest rate that is below market, down payment help and other incentives. Housing finance agencies can assist you with a lower rate of interest, get you your down payment, and provide other benefits. The central mission of non-profit housing finance agencies is to promote the purchase of homes in particular areas.

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

• Federal Housing Administration (FHA) mortgage loans

  The Federal Housing Administration (FHA), which is inside the U.S. Department of Housing and Urban Development (HUD), plays an important role in aiding low to moderate-income families qualify for mortgages. Part of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists homebuyers in getting mortgage loans. FHA provides mortgage insurance to private lenders, enabling buyers who will not be eligible for a typical loan, to receive a mortgage. Interest rates for an FHA loan are usually the current interest rate, while the down payment with an FHA mortgage are below those of conventional loans. The required down payment may be as low as 3 percent while the closing costs could be included in the mortgage loan.

• VA mortgage loans

  With a guarantee from the Department of Veterans Affairs, a VA loan is offered to service people and veterans. This particular loan does not require a down payment, has reduced closing costs, and offers a competitive rate of interest. Even though the mortgages aren't actually issued by the VA, the office certifies borrowers by providing eligibility certificates.

• Piggy-back loans

  You can fund a down payment using a second mortgage that closes at the same time as the first. Most of the time, the piggyback loan is for 10 percent of the home's price, and the first mortgage finances 80 percent. Instead of the traditional 20 percent down payment, the homebuyer just has to pull together the remaining 10 percent.

• Carry-Back loans

  In a "carry back" mortgage, the seller agrees to loan you some of his own equity to help you get your down payment funds. The buyer finances the highest percentage of the purchase price through a traditional mortgage program and finances the remaining funds with the seller. Generally, this kind of second mortgage has higher interest.

No matter how you gather down payment money, the thrill of owning your own home will be just as great!

Need to talk about the best options for down payments? Call us: 3217777277.