Your Down Payment

Many buyers qualify for a loan, but they can't afford a large down payment. Below are a few straightforward methods that will help you put together a down payment

Tighten your belt and save. Look for ways to reduce your monthly expenses to put away money for a down payment. You also could enroll in an automatic savings plan to have a portion of your payroll automatically deposited into savings. Some practical methods to put together funds include moving into less expensive housing, and staying local for your vacation for a year or two.

Work more and sell things you don't need. Try to get a second job. This can be exhausting, but the temporary difficulty can help you get your down payment. You can also get creative about the items you can put up for sale. A closetful of small items may add up to a fair amount at a garage or tag sale. You might also explore what your investments may sell for.

Borrow from your retirement funds. Research the specifics of your particular plan. Some people get down payment money by withdrawing what they need from Individual Retirement Accounts or taking money out of their 401(k) plans. Make sure you understand about any penalties, the way this may affect on income taxes, and repayment terms.

Request a gift from your family. First-time homebuyers somtimes get down payment help from thoughtful parents and other family members who are able to help them get into their first home. Your family members may be pleased to help you reach the goal of having your first home.

Learn about housing finance agencies. These types of agencies provide special loan programs to moderate and low income borrowers, buyers with an interest in renovating a home within a specific part of the city, and other groups as specified by the finance agency. Financing through a housing finance agency, you may get a below market interest rate, down payment help and other perks. These kinds of agencies may assist eligible buyers with a reduced rate of interest, get you your down payment, and provide other benefits. These non-profit agencies to build up community in certain neighborhoods.

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

• Federal Housing Administration (FHA) mortgage loans

  The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays an important part in helping low to moderate-income buyers qualify for mortgages. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA assists first-time homebuyers and others who might not be able to qualify for a traditional mortgage by themselves, by providing mortgage insurance to the private lenders. Interest rates for an FHA mortgage usually feature the going interest rate, but the down payment for an FHA mortgage will be below those of conventional loans. The required down payment may go as low as 3 percent and the closing costs may be covered by the mortgage.

• VA mortgage loans

  With a guarantee from the Department of Veterans Affairs, a VA loan assists service people and veterans. This special loan requires no down payment, has limited closing costs, and provides the advantage of a competitive rate of interest. While the loans don't originate from the VA, the department verfifies applicants by providing eligibility certificates.

• Piggy-back loans

  A piggy-back loan is a second mortgage that you close along with the first. In most cases the first mortgage covers 80% of the purchase amount and the "piggyback" is for 10%. Instead of the traditional 20 percent down payment, the buyer will just have to pull together the remaining 10 percent.

• Carry-Back loans

  In a "carry back" mortgage, the seller agrees to lend you part of his home equity to help you get your down payment funds. The buyer finances the majority of the purchase price through a traditional mortgage program and borrows the remainder from the seller. Usually you will pay a somewhat higher rate on the loan financed by the seller.

No matter your method of pulling together your down payment funds, the thrill of living in your own home will be just as sweet!

Need to talk about down payments? Call us at (321) 777-7277.