Your Down Payment

Lots of people who would like to buy a new house qualify for several different kinds of mortgages, but they don't have much to pay a down payment. Below are a few ways to put together a down payment

Tighten your belt and save. Look for ways to reduce your monthly expenditures to save toward a down payment. Also, you can look into bank programs through which some of your paycheck is automatically placed into savings every pay period. Some effective approaches to save additional funds include moving into a residence that is less expensive, and skipping a year's vacation.

Sell items you don't need and get a second job. Look for a second job. This can be exhausting, but the temporary trial can provide your down payment money. You can also get creative about the items you could be able to put up for sale. You might have desirable items you can put up for sale at an online auction, or household items for a tag or garage sale. Also, you might want to consider selling any investments you own.

Borrow from retirement funds. Explore the specifics for your particular plan. Some homebuyers get down payment money from withdrawing funds from their Individual Retirement Accounts or taking funds out of their 401(k) programs. Be sure to ask your plan representative about the tax ramifications, your obligation for repayment, and possible early withdrawal penalties.

Request a gift from your family. Many buyers are often fortunate enough to receive help with their down payment assistance from giving parents and other family members who may be eager to help them get into their own home. Your family members may be pleased to help you reach the milestone of buying your first home.

Contact housing finance agencies. These types of agencies offer provisional loan programs for low and moderate-income homebuyers, buyers interested in renovating a home within a targeted part of the city, and other certain types of buyers as specified by the finance agency. With the help of this type of agency, you may get a below market interest rate, down payment assistance and other incentives. These types of agencies may help eligible buyers with a lower interest rate, help with your down payment, and provide other assistance. The principal goal of not-for-profit housing finance agencies is boosting residential ownership in targeted areas.

Research no-down and low-down mortgage loan programs.

• FHA mortgages

  The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays a critical part in aiding low to moderate-income buyers qualify for mortgages. Part of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA helps first-time homebuyers and others who might 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 lower than those with traditional mortgage loans, although these loans come with average rates of interest. The required down payment can be as low as three percent and the closing costs might be financed in the mortgage loan.

• VA mortgage loans

  With a guarantee from the Department of Veterans Affairs, a VA loan assists veterens and service people. This special loan requires no down payment, has limited closing costs, and offers a competitive rate of interest. Even though the mortgage loans don't originate from the VA, the office certifies borrowers by issuing eligibility certificates.

• Piggy-back loans

  You can fund your down payment through a second mortgage that closes at the same time as the first. Usually the piggyback loan takes care of 10 percent of the purchase amount, while the first mortgage finances 80 percent. The homebuyer covers the remaining 10%, instead of needing to pull together the usual 20% down payment.

• Carry-Back loans

  In the option of the seller "carrying back a second mortgage," the seller loans you part of his or her equity. The buyer finances most of the purchase price with a traditional mortgage program and finances the remaining funds with the seller. Typically, this kind of second mortgage will have a higher rate of interest.

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

Want to discuss your down payment? Give us a call at 866-300-1550.