Your Down Payment

Many borrowers can easily qualify for several different kinds of mortgages, but they don't have a large sum of cash to pay a down payment. Here are a few tips:

Tighten your belt and save. Be on the look-out for ways you can reduce your expenses to put away money for a down payment. Also, you can look into bank programs in which some of your take-home pay is automatically deposited into savings each pay period. Some effective ways to save additional funds include moving into housing that is less expensive, and staying home for your family vacation this year.

Sell items you don't need and get a second job. Try to find an additional job. This can be rough, but the temporary difficulty can provide your down payment money. You can also get creative about the items you can sell. A closetful of small items could add up to a nice sum at a garage or tag sale. You could also research what your investments will bring if sold.

Tap into your retirement funds. Research the details of your particular plan. You may borrow funds from a 401(k) plan for you down payment or withdraw from an IRA. Make sure you are knowledgable about any penalties, the effect this could have on your taxes, and repayment terms.

Ask for a gift from your family. First-time buyers are often lucky enough to receive help with their down payment help from giving parents and other family members who may be able to help them get into their first home. Your family members may be willing to help you reach the milestone of buying your own home.

Contact housing finance agencies. These agencies provide provisional mortgate loan programs to moderate and low income buyers, buyers interested in renovating a residence in a particular area, and additional groups as defined by the finance agency. Working through this type of agency, you can get an interest rate that is below market, down payment assistance and other advantages. Housing finance agencies may help you with a lower interest rate, help with your down payment, and offer other assistance. These non-profit programs exist to promote home ownership in particular areas.

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

  • Federal Housing Administration (FHA) mortgage loans

    The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays a significant role in helping low to moderate-income families get mortgages. An office of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists individuals in getting home financing. FHA aids first-time buyers and others who may not be able to qualify for a conventional mortgage loan by themselves, by offering mortgage insurance to lenders. Down payment totals for FHA loans are smaller than those with conventional mortgages, even though these loans hold current rates of interest. The required down payment may go as low as three percent while the closing costs may be financed in the mortgage loan.

  • VA loans

    VA loans are backed by the U.S. Department of Veterans Affairs. Veterens and service people can get a VA loan, which typically offers a competitive rate of interest, no down payment, and reduced closing costs. While the VA does not provide the mortgages, it does certify eligibility to qualify for a VA loan.

  • Piggy-back loans

    You can fund your down payment using a second mortgage that closes with the first. Often the first mortgage is for 80% of the purchase price and the "piggyback" is for 10%. The borrower pays the remaining 10%, instead of putting the usual 20% down payment.

  • Carry-Back loans

    We a seller carries back a second mortgage, the seller loans you part of his or her equity. In this scenario, you would borrow the largest portion of the purchase price from a traditional lending institution and borrow the remainder from the seller. Typically you'll pay a slightly higher interest rate on the loan from the seller.

The satisfaction will be the same, no matter how you manage to pull together your down payment. Your new home will be worth it!

Need to talk about down payments? Give us a call: 9043423622.

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St. Augustine, FL 32092