Determining how much of a down payment needed to buy a home can be difficult at time. If you are saving up to buy your first home or wondering if you have enough equity to trade out for another, you may be relieved to know that for most buyers, low down payment options are still available to purchase a home. These are just a few of the most commonly used mortgage loan types.
0% Down Payment
The VA (Veterans Administration) and the USDA (US Department of Agriculture) loans both offer a zero down program for individuals and/or properties that meet their criteria. Sometimes, loans require little or no cash our of pocket. Some of the HUD (Housing and Urban Development) properties are available with a little as $100 down. You will need to contact your local mortgage lender for additional details on each. Learn more about USDA.
The FHA or Federal Housing Administration loan program can allow as little as 3.5% down and it is more lenient than most other programs on minimum credit scores and other factors. This mortgage loan program is a government loan and is used widely by many first time home buyers. Contact your local mortgage lender to determine if you qualify.
Fannie Mae / Freddie Mac conventional loans are available with down payments as low as 3%- 5%. The minimum on these programs can change dependent on factors such as property type, credit score, occupancy, etc. This low down payment options are for primary home owners only. If this will be a second home/ vacation home then the minimum down payment will be 10% of the homes purchase price.
Are you surprised at how low you may be able to go? While many believe a 20% down payment is required or simply the most prudent, you can see now that its far from the only option. Whether you have saved a little or a lot, reach out today and we will work on finding the perfect formula that is right for you.