Your Down Payment

Lots of buyers qualify for several different kinds of mortgages, but they can't afford a large down payment. Get started here

Slash your budget and build up savings. Turn your budget upside-down to uncover ways you can cut expenses to save for your down payment. You could also try enrolling in an automatic savings plan to have a portion of your payroll automatically transferred into a savings account. 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 decide to move into less expensive housing, or stay local for your family vacation.

Sell things you don't really need and find a part-time job. Try to get an additional job. This can be exhausting, but the temporary difficulty can provide your down payment money. In addition, you can put together a comprehensive list of things you can sell. Unused gold jewelry can be sold at local jewelry stores. A closetful of small things may add up to a fair amount at a garage or tag sale. You could also explore what any investments you hold could bring if sold.

Borrow from your retirement funds. Investigate the parameters of your specific plan. Some people get down payment money by withdrawing funds from Individual Retirement Accounts or getting money out of 401(k) plans. Make sure to find out about the tax ramifications, your obligation for repayment, and any penalties for withdrawing early.

Ask for help from members of your family. Many buyers somtimes get down payment assistance from giving parents and other family members who are anxious to help get them in their first home. Your family members may be happy at the chance to help you reach the milestone of buying your first home.

Research housing finance agencies. These agencies provide special mortgage programs to moderate and low income buyers, buyers with an interest in remodeling a residence in a specific area, and other groups as specified by each finance agency. With the help of this kind of agency, you may receive an interest rate that is below market, down payment assistance and other benefits. These types of agencies may assist eligible buyers with a lower rate of interest, help with your down payment, and provide other assistance. The primary purpose of not-for-profit housing finance agencies is to boost residential ownership in certain areas.

Find out about low-down and no-down mortgage loan programs.

• 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 a vital part in helping low to moderate-income individuals get mortgages. Part of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA assists first-time buyers and others who may not be eligible for a traditional mortgage loan by themselves, by offering mortgage insurance to lenders. Down payment requirements for FHA mortgages are less than those with traditional mortgage loans, even though these mortgages come with average rates of interest. Closing costs may be financed within the mortgage, and the down payment could be as low as 3% of the total amount.

• VA loans

  VA loans are backed by the U.S. Department of Veterans Affairs. Veterens and service people can receive a VA loan, which generally offers a competitive fixed rate of interest, no down payment, and limited closing costs. Although the VA doesn't finance the mortgages, it does issue a certificate of eligibility to qualify for a VA mortgage.

• Piggy-back loans

  A piggy-back loan is a second mortgage that you close with the first. In most cases the first mortgage is for 80% of the purchase price and the "piggyback" is for 10%. Instead of the traditional 20 percent down payment, the buyer just has to cover the remaining 10 percent.

• Carry-Back loans

  In a "carry back" situation, the seller agrees to loan you a portion of his home equity to help you with your down payment money. In this scenario, you would borrow the majority of the purchase price from a traditional lender and finance the remainder with the seller. Often, this form of second mortgage will have a higher rate of interest.

No matter how you gather your down payment, the satisfaction of living in your own home will be just as great!

Need to talk about the best options for down payments? Call us: 2057831113.