Putting Together Your Down Payment

Lots of borrowers can qualify for various loan programs, but they can't afford a large down payment. Get started here

Cut expenses and save. Look for ways you can trim your monthly expenditures to put away money for a down payment. There are bank programs in which a portion of your take-home pay is automatically deposited into savings each pay period. You would be wise to 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 vacation.

Sell things you do not need and find a part-time job. Maybe you can find a second job to get your down payment money. Additionally, you can make an exhaustive list of things you can sell. Unworn gold jewelry can bring a good amount from local jewelers. Maybe you have desirable items you can sell at an auction website, or household items for a garage or tag sale. Also, you might want to consider selling any investments you hold.

Borrow funds from a retirement plan. Research the details of your individual plan. Many people get down payment money from withdrawing from their IRAs or getting money out of 401(k) plans. You will need to ensure you know about any penalties, the way this may affect on taxes, and repayment obligation.

Ask for assistance from generous members of your family. Many buyers are sometimes fortunate enough to get help with their down payment help from caring parents and other family members who are willing to help get them in their own home. Your family members may be pleased to help you reach the milestone of owning your own home.

Learn about housing finance agencies. These types of agencies offer special mortgate loan programs to moderate and low income borrowers, buyers interested in sprucing up a house within a specific area, and additional certain kinds of buyers as defined by the finance agency. With the help of a housing finance agency, you can be given a below market interest rate, down payment help and other advantages. Housing finance agencies may help you with a lower rate of interest, get you your down payment, and offer other benefits. These non-profit agencies exist to boost community in particular places.

Learn about low-down and no-down mortgages.

• Federal Housing Administration (FHA) loans

  The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in helping low and moderate-income buyers qualify for mortgage loans. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists homebuyers who wish to get mortgages. FHA offers mortgage insurance to the private lenders, enabling homebuyers who might not qualify for a typical loan, to receive financing. Down payment totals for FHA loans are less than those with traditional mortgage loans, although these mortgages hold average rates of interest. The required down payment may go as low as three percent while the closing costs might be financed in the mortgage.

• VA loans

  With a guarantee from the Department of Veterans Affairs, a VA loan is offered to veterens and service people. This special loan requires no down payment, has reduced closing costs, and provides a competitive interest rate. Even though the VA does not actually issue the mortgage loans, it does certify eligibility to apply for a VA loan.

• Piggy-back loans

  You may finance a down payment using a second mortgage that closes along with the first. In most cases the first mortgage is for 80% of the cost of the home and the "piggyback" funds 10%. In contrast to the traditional 20 percent down payment, the buyer will just have to cover the remaining 10 percent.

• Carry-Back loans

  With a carry-back mortgage, the you borrow a portion of the seller's home equity.. The buyer finances the highest percentage of the purchase price with a traditional mortgage program and borrows the remainder from the seller. Often, this type of second mortgage will have a higher rate of interest.

Need to talk about your down payment? Give us a call at 7184417000.