Monday, November 23, 2020 / by Brad Brethouwer
Comparing the Different Types of Down Payment Options
There are many ways you can buy a house, but most of them include a down payment. This can frighten people who feel they may never have enough money saved to put down on a home. People seem to highly overestimate how much is needed and are unaware that there are plenty of opportunities for making a smaller down payment. Some even remove the down payment entirely! Dan Leeder of Inlanta Mortgage is here to talk about some options you have.
USDA loans are still great, providing a no-money-down option for people living in more rural areas. While first-time homebuyers overestimate down payments, they’re simultaneously unaware that there are no-money-down programs specifically for them! There’s also down payment assistance, and sometimes a seller credit will help to pay for a buyer’s closing costs. You could potentially walk into a home closing with almost no money down, especially as a first-time homebuyer. Even if it isn’t your first time, there are still options available.
“You could potentially walk into a home closing with almost no money down, especially as a first-time homebuyer.”
There is also the option of a lender credit, which can be used in combination with or in place of seller credit to lower the down payment. People don’t like paying mortgage insurance and would rather save the money, but 20% equity in the home is required to get rid of it. The problem is typically that, by the time the 20% down is saved up, the home has already rapidly appreciated in price. Interest rates and home prices are continuing to rise while you wait to buy, causing you to spend more the longer you wait.
Reach out to Dan at 608-320-8299 if you’d like to explore your options when buying a home. If you have any other questions, I’d be happy to help you. We look forward to hearing from you.