Down payments take time to save up for and are one of the main reasons most people don’t rush into purchasing a home. Thankfully, there are now many options available that allow borrowers to purchase a home without a large down payment.
Some of these low or no down payment mortgage loans include VA loans, USDA loans, Conventional loans and FHA loans, with FHA loans being the most common. By securing your home financing through one of these loan options you can pass on putting a large amount down on your home, which can be helpful in a few different ways.
Some people may not have the money to make a 20% down payment, so having the option to put down 0% in the case of a USDA loan or as low as 3.5% in the case of an FHA loan, may sound appealing.
There are also benefits to low down payments, even if you have the money to put down more than 3.5%.
If you don’t plan on living in the same home long-term or plan to make other large purchases shortly after purchasing your home, putting down a smaller amount and keeping the rest of your cash in your savings will give you more flexibility in scenarios like these. In cases like these, the extra funds you are saving may be better used elsewhere than to lower your monthly mortgage payment.
Depending on your current situation, these options may work out very well for you or they could be a risky gamble, which is why it is important to discuss all your mortgage options before making any final decisions.
As a senior mortgage consultant, I have worked with many clients who have come to me in all different financial situations. I strive to build lasting relationships with each of my clients, so your wellbeing will always be my priority. We will review your current situation and your goals for the future together and make a decision, based on my experience and knowledge of the industry and what you feel comfortable with.
If you have any questions about your options for a no or low down payment mortgage loan, or need help getting the process started, give me a call today!