Your Down Payment

Many buyers qualify for various loan programs, but they can't afford a large down payment. Here's where you start

Tighten your belt and save. Scrutinize the budget to uncover ways you can cut expenses to save for your down payment. Also, you can look into bank programs through which a specific portion of your take-home pay is automatically deposited into savings every pay period. Some practical approaches to save additional funds include moving into less expensive housing, and skipping a year's vacation.

Work a second job and sell items you don't need. Try to find a second job. This can be rough, but the temporary trial can help you get your down payment. In addition, you can put together an exhaustive list of items you can sell. Broken gold jewelry can be sold at local jewelry stores. Maybe you have desirable items you can put up for sale at an online auction, or household goods for a garage or tag sale. Also, you can consider selling any investments you hold.

Tap into your retirement funds. Check the provisions of your specific plan. It is possible to borrow funds from a 401(k) plan for a down payment or withdraw from an Individual Retirement Account. Be sure you understand about any penalties, the way this will affect on income taxes, and repayment obligation.

Ask for help from family members. First-time buyers are sometimes lucky enough to receive help with their down payment assistance from gracious family members who are prepared to help get them in their first home. Your family members may be happy at the chance to help you reach the milestone of having your own home.

Learn about housing finance agencies. These types of agencies offer provisional mortgate loan programs- for moderate and low income homebuyers, buyers with an interest in sprucing up a residence in a specific part of the city, and other specific types of buyers as defined by each agency. Financing with a housing finance agency, you can receive a below market interest rate, down payment help and other benefits. These types of agencies can help you with a reduced interest rate, help with your down payment, and provide other advantages. These non-profit agencies were formed to build up community in certain places.

Research no-down and low-down mortgage loans.

• Federal Housing Administration (FHA) mortgage loans

  The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays a significant part in assisting low to moderate-income families get mortgages. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) assists homebuyers in getting mortgages. FHA helps first-time homebuyers and others who may not be able to qualify for a typical loan by themselves, by offering mortgage insurance to lenders. Interest rates with an FHA loan generally feature the going interest rate, while the down payment with an FHA mortgage are lower than those of conventional loans. The required down payment may go as low as three percent while the closing costs may be covered by the mortgage loan.

• VA mortgage loans

  Guaranteed by the Department of Veterans Affairs, a VA loan qualifies service people and veterans. This particular loan does not require a down payment, has limited closing costs, and provides a competitive interest rate. Even though the VA does not provide the mortgage loans, it does certify eligibility to qualify for a VA loan.

• Piggy-back loans

  You can fund your down payment using a second mortgage that closes along with the first. Most of the time, the piggyback loan takes care of 10 percent of the purchase price, while the first mortgage covers 80 percent. Rather than the traditional 20 percent down payment, the buyer just has to pull together the remaining 10 percent.

• Carry-Back loans

  In the case of the seller "carrying back a second mortgage," the seller loans you part of his or her home equity. The buyer finances most of the purchase price with a traditional mortgage program and borrows the remaining funds from the seller. Typically you'll pay a slightly higher rate with the loan from the seller.

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

Need to talk about your down payment? Call us at (818)645-7035.