Your Down Payment
Lots of folks who would like to buy a new house can qualify for various loan programs, but they don't have much to pay a down payment. Below are a few ways to put together a down payment
Reduce expenses and save. Look for ways you can trim your monthly expenditures to save toward a down payment. There are bank programs through which a specific portion of your paycheck is automatically placed into savings each pay period. You would be wise to look into some big expenses in your spending history that you can give up, or trim, at least temporarily. Here are a couple of examples: you might move into less expensive housing, or skip a vacation.
Work more and sell items you don't need. Perhaps you can find a second job and save your earnings. In addition, you can make an exhaustive inventory of things you can sell. Unworn gold jewelry can bring a good amount from local jewelry stores. You might own desirable items you can put up for sale at an auction website, or quality household goods for a tag or garage sale. Also, you might want to look into selling any investments you hold.
Tap into your retirement funds. Research the details of your individual plan. You may pull out funds from a 401(k) for a down payment or make a withdrawal from an IRA. Make sure you comprehend the tax ramifications, your obligation for repayment, and any early withdrawal penalties.
Ask for help from family members. First-time homebuyers somtimes receive down payment help from giving family members who are eager to help get them in their own home. Your family members may be pleased to help you reach the goal of owning your first home.
Learn about housing finance agencies. Provisional mortgage loans are given to homebuyers in certain situations, like low income purchasers or buyers looking to remodel houses in a particular neighborhood, among others. Financing through this type of agency, you can receive an interest rate that is below market, down payment help and other advantages. Housing finance agencies can help eligible buyers with a lower interest rate, help with your down payment, and provide other assistance. These non-profit programs to build up home ownership in certain areas.
Research no-down and low-down mortgage loan programs.
- FHA loans
The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays a critical part in helping low to moderate-income families qualify for mortgage loans. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get
FHA assists first-time buyers and others who might not be eligible for a traditional loan on their own, by providing mortgage insurance to the private lenders.
Down payment sums for FHA mortgages are lower than those with conventional mortgages, even though these loans hold current interest rates. The required down payment may go as low as three percent and the closing costs might be packaged in the mortgage loan.
- VA mortgage loans
Guaranteed by the Department of Veterans Affairs, a VA loan qualifies service people and veterans. This special loan does not require a down payment, has mimimal closing costs, and offers a competitive rate of interest. While the mortgage loans don't originate from the VA, the office verfifies borrowers by providing eligibility certificates.
- Piggy-back loans
A piggy-back loan is a second mortgage that closes with the first. Most of the time, the piggyback loan is for 10 percent of the purchase amount, and the first mortgage finances 80 percent. The borrower pays the remaining 10%, instead of come up with the usual 20% down payment.
- Carry-Back loans
In the option of a seller "carrying back a second mortgage," the you borrow part of the seller's home equity.. The buyer funds the highest percentage of the purchase price with a traditional mortgage program and borrows the remainder from the seller. Generally, this type of second mortgage has higher interest.
The satisfaction will be the same, no matter how you manage to put together the down payment. Your brand new home will be your reward!
Want to discuss down payment options? Call us at (510) 683-9850.