Your Down Payment

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Lots of buyers can qualify for various loan programs, but they don't have much to put up a down payment. Here are a few methods that will help you put together a down payment

Tighten your belt and save. Be on the look-out for ways you can trim your monthly expenses to put away money for a down payment. You might also try enrolling in an automatic savings plan at your bank to have a percentage of your payroll automatically moved into savings. Some effective ways to save additional funds include moving into less expensive housing, and staying local for your family vacation for a year or two.

Sell things you do not need and get a second job. Perhaps you can get an additional job to get your down payment money. In addition, you can make an exhaustive inventory of things you can sell. Broken gold jewelry can bring a good price from local jewelry stores. Multiple small things can add up to a nice sum at a garage or tag sale. Also, you can consider selling any investments you own.

Borrow from retirement funds. Research the details of your particular plan. It is possible to borrow money from a 401(k) plan for you down payment or get a withdrawal from an Individual Retirement Account. Make sure to learn about the tax consequences, repayment terms, and penalties for withdrawing early.

Request a gift from your family. Many homebuyers somtimes receive down payment assistance from thoughtful family members who may be able to help them get into their own home. Your family members may be inclined to help you reach the milestone of buying your own home.

Learn about housing finance agencies. Provisional loan programs are provided to buyers in specific situations, like low income purchasers or homebuyers planning to remodel homes in a certain part of town, among others. Working with this type of agency, you may be given a below market interest rate, down payment help and other benefits. Housing finance agencies may help eligible buyers with a lower rate of interest, help with your down payment, and offer other advantages. These non-profit agencies exist to boost community in particular places.

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

• FHA loans

  The Federal Housing Administration (FHA), which is part of the U.S. Department of Housing and Urban Development (HUD), plays a critical role in helping low and moderate-income buyers 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 homebuyers and others who might not be eligible for a conventional mortgage by themselves, by providing mortgage insurance to the lenders. Down payment amounts for FHA loans are lower than those with traditional mortgages, although these mortgages have average interest rates. The down payment may be as low as 3 percent while the closing costs can be financed in the mortgage loan.

• VA mortgages

  VA loans are guaranteed by the Department of Veterans Affairs. Service persons and veterans can get a VA loan, which usually offers a competitive fixed rate of interest, no down payment, and minimal closing costs. While it's true that the mortgages aren't actually issued by the VA, the department certifies borrowers by issuing eligibility certificates.

• Piggy-back loans

  A piggy-back loan is a second mortgage that you close with the first. Most of the time, the first mortgage is for 80% of the purchase price and the "piggyback" is for 10%. In contrast to the usual 20 percent down payment, the buyer will just have to cover the remaining 10 percent.

• Carry-Back loans

  In a "carry back" mortgage, the seller agrees to loan you a portion of his own equity to help you get your down payment funds. The buyer funds the majority of the purchase price through a traditional mortgage program and borrows the remaining funds from the seller. Typically you will pay a slightly higher rate on the loan from the seller.

Want to discuss your down payment? Give us a call at 800-530-9421.