First-time Homebuyers: You’re Closer to a Down Payment Than You Think

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First-time Homebuyers: You’re Closer to a Down Payment Than You Think

First-time Homebuyers: You’re Closer to a Down Payment Than You Think

For many first-time buyers, saving for a down payment is the most difficult step in the home-buying process. However, it’s a common misconception that you always need 20 percent down to buy a home.

Here’s the lowdown on the most popular low-down alternative payment options:

FHA Loan – Traditionally the mortgage of choice for first-time buyers, the Federal Housing Administration (FHA) offers government-insured loans with as little as 3.5 percent down. The most popular FHA loan option, the 203(b), is widely available from lenders across the country. You may qualify with a credit score of just 500, although there may be limitations on some condo purchases.

Home Possible from Freddie Mac – This program allows you to put between 3 and 5 percent down, as long as you intend to use the home as your primary residence, and don’t currently own or share ownership of another house. You’ll also need to complete a required homeownership education program online.

Conventional 97 from Fannie Mae – Just 3 percent down is enough to help you qualify for a Conventional 97, as long as you’re applying for a fixed-rate mortgage on a single-family home that’s less than $417,000. You’ll also need to participate in a homeownership education program, and at least one of the purchasers applying for the loan must be a first-time buyer.

HomeReady from Fannie Mae – Another option that requires as little as 3 percent down, HomeReady can also offer below-market interest rates. Additionally, this program allows non-occupant borrowers to apply. For example, parents can secure this type of loan for a young adult who’s just starting to establish credit.

To discuss the best option for you and to get a head start on your home search, contact your local RE/MAX agent today!

By |2018-07-06T17:51:08+00:00June 27th, 2018|Investment, Mortgages|0 Comments

About the Author:

Over the past 30 years, the Nunez Team have been blessed to help over 3,000 families buy and sell their homes. Their goal is still the same, to help people accomplish their Real Estate dreams. Real Estate is Mike and Irma’s passion and they look forward to working with you.

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