No Down Payment, No Problem!

The top concern I hear over and over again is that potential buyers do not have enough money saved for a down payment. Depending on your financial situation, there are multiple options that can help you with the down payment needed.

Typically a first time home buyer can use a FHA loan (3% downpayment), VA loan ($0 down), Conventional (has 3% downpayment option) and USDA ($0 down). Lets assume you are looking at a $400,000 home and need a downpayment of $12,000. Some options you have are:

1. Using a downpayment assistance program that will cover the $12,000. With this option you will still need to pay closing costs for the loan, which if you negotiate upfront the seller may be willing to pay for to get the deal done.

The Downpayment Assistance typically will be in the form of a 2nd and 3rd

mortgage on the home that does not need to be paid until you go and sell later

down the line.

2. Using 401(k) funds to buy a home, either by taking a loan from the account or by withdrawing money from the account.

3. Negotiating with your agent on a lower commission (instead of the typical 2.5%-3% see if they would be willing to represent you for 1% or a flat fee). This way you can use that additional money as a buyer credit to help cover the downpayment.

4. Always make sure to run these options by your lender to see which one might work best for you!

#lending #mortgage #realestate