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Down Payment Assistance
A down payment is the initial cash payment the buyer makes during a real estate transaction.
The down payment is a small percentage of the total purchase price. The amount of down payment you will put down depends on your savings and what type of loan you qualify for, but the norm is usually between 3 percent and 20 percent of the home’s total purchase price.
Example: If you buy a home for $300,000, a 10 percent down payment would be $30,000 that you would pay out of pocket and the remaining $270,000 would be covered by a home loan. You may be eligible to receive down payment assistance! Click the green button below to check your eligibility!
Tips to Save for a Down Payment
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Take a look at your monthly income and identify purchases you can cut back on, then transfer all excess money to a savings account.
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Be strategic about your savings account; choose a high-yield savings account or a certificate of deposit.
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Don't wait to save, start immediately!
Does Size Matter?
Consider these pros and cons when deciding how much down payment you would like to put down.
PROS
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The bigger the down payment, the smaller the monthly mortgage.
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The bigger the down payment, the less you'll pay in interest over the lifetime of the loan.
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By putting more down, you are using less of the lender's money, so they are more likely to give you better loan terms (like lower interest rates).
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If you put down more than 20% on a conventional loan, you won't have to pay mortgage insurance!
CONS
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If you use all of your savings to put into the down payment, you won't have much (if any) money available if you have an emergency or unexpected moving or repair costs.
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Taking time to save for a bigger down payment may make you miss out on a good opportunity and good pricing. While you cut back on expenses, home prices may be rising at a pace that you can't keep up with.