Your Down Payment

Lots of buyers can easily qualify for a mortgage loan, but they can't afford a large down payment. Here are a few tips:

Tighten your belt and save. Look for ways you can trim your expenditures to set aside funds for a down payment. Also, you can look into bank programs in which a portion of your take-home pay is automatically transferred into savings each pay period. Some effective approaches to put together funds include moving into less expensive housing, and skipping a year's vacation.

Work a second job and sell things you don't need. Perhaps you can find an additional job and build up your earnings. Additionally, you can make an exhaustive list of things you may be able to sell. Unworn gold jewelry can be sold at local jewelers. Maybe you have desirable items you can sell at an auction website, or quality household goods for a garage or tag sale. You could also explore what your investments may sell for.

Borrow your down payment from your retirement plan. Explore the specifics for your particular plan. Some people get down payment money from withdrawing what they need from IRAs or borrowing from 401(k) programs. Be sure to ask your plan representative about the tax ramifications, your obligation for repayment, and penalties for withdrawing early.

Ask for help from members of your family. Many homebuyers are often fortunate enough to get help with their down payment assistance from caring family members who are prepared to help get them in their own home. Your family members may be pleased to help you reach the goal of buying your first home.

Contact housing finance agencies. Provisional mortgate loan programs are provided to homebuyers in certain situations, such as low income homebuyers or homebuyers looking to remodel homes in a particular neighborhood, among others. Financing with this kind of agency, you can get an interest rate that is below market, down payment help and other incentives. These kinds of agencies may assist eligible buyers with a reduced rate of interest, help with your down payment, and provide other advantages. These non-profit agencies to build up community in specific places.

Learn about low-down and no-down mortgages.

• Federal Housing Administration (FHA) mortgages

  The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in helping low to moderate-income buyers qualify for mortgage loans. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA provides mortgage insurance to private lenders, enabling buyers who will not qualify for a typical mortgage, to receive a mortgage. Down payment requirements for FHA mortgages are lower than those for typical mortgage loans, although these mortgages hold current rates of interest. The required down payment can go as low as 3 percent while the closing costs could be financed in the mortgage.

• VA loans

  VA loans are backed by the U.S. Department of Veterans Affairs. Veterens and service people can benefit from a VA loan, which generally offers a low fixed interest rate, no down payment, and reduced closing costs. While it's true that the mortgages are not actually financed by the VA, the office certifies borrowers by providing eligibility certificates.

• Piggy-back loans

  You can finance your down payment using a second mortgage that closes with the first. Generally the piggyback loan is for 10 percent of the home's price, and the first mortgage covers 80 percent. The borrower pays the remaining 10%, rather than needing to put together 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 majority of the purchase price from a traditional mortgage lending institution and finance the remaining amount with the seller. Usually you'll pay a slightly higher rate on the loan financed by the seller.

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

Need to talk about down payment options? Call us: (773) 774-9040 Ext 121.