Your Down Payment

Many people who are looking to purchase a new home can easily qualify for various loan programs, but they can't afford a large down payment. We have a few suggestions

Cut expenses and save. Scrutinize the budget to find 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 placed into a savings account each pay period. Some practical methods to build up funds include moving into less expensive housing, and skipping a year's vacation.

Work more and sell things you don't need. Perhaps you can find an additional job and save your earnings. Additionally, you can put together a comprehensive inventory of things you can sell. Broken gold jewelry can bring a good price from local jewelers. A closetful of small items may add up to a fair amount at a garage or tag sale. Also, you might want to consider selling any investments you hold.

Borrow from a retirement plan. Investigate the parameters of your specific program. Some people get down payment money from withdrawing what they need from their IRAs or borrowing from 401(k) plans. Make sure to learn about the tax consequences, your obligation for repaying funds, and any early withdrawal penalties.

Ask for help from generous family members. First-time homebuyers are often lucky enough to get down payment assistance from gracious family members who are prepared to help get them in their first home. Your family members may be inclined to help you reach the goal of having your first home.

Contact housing finance agencies. Provisional mortgate loan programs are given to buyers in specific situations, such as low income homebuyers or people planning to remodel houses in a targeted neighborhood, among others. With the help of this kind of agency, you can receive a below market interest rate, down payment assistance and other perks. These types of agencies may help eligible buyers with a reduced rate of interest, help with your down payment, and provide other benefits. These non-profit programs exist to build up community in particular areas.

Research no-down and low-down mortgages.

  • 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 an important part in aiding low and moderate-income Americans qualify for mortgage loans. An office of the United States Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA offers mortgage insurance to private lenders, helping the buyers to become eligible for a mortgage. Down payment sums for FHA loans are smaller than those of traditional mortgage loans, although these loans come with average rates of interest. Closing costs may be financed within the mortgage, while your down payment might be as low as 3% of the total amount.

  • VA loans

    Guaranteed by the Department of Veterans Affairs, a VA loan qualifies service people and veterans. This special loan requires no down payment, has limited closing costs, and provides the benefit of a competitive interest rate. While the VA does not finance the mortgage loans, 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 closes at the same time as the first. Generally the piggyback loan is for 10 percent of the home's amount, and the first mortgage finances 80 percent. The borrower pays the remaining 10%, instead of putting the usual 20% down payment.

  • Carry-Back loans

    In the case of a seller "carrying back a second mortgage," the seller loans you part of his or her equity. You would borrow the majority of the purchase price from a traditional lender and finance the remainder with the seller. Typically you'll pay a slightly higher rate on the loan from the seller.

The feeling of accomplishment will be the same, no matter how you manage to get together your down payment. Your new home will be your reward!

Need to talk about your down payment? Give us a call: 7186399500.

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Channel Mortgage LLC

Connecting the Dots to Home Ownership

55-25 69th Street 1st Floor
Maspeth, NY 11378-1806