Buying your first home can seem like a huge hurdle, especially coming up with the initial down payment.
I designed this page to provide you with several professional tips and facts concerning different financing options. And to help you look at the assets you already have in a new way. This information may solve your down payment and financing concerns.
- Explore low down payment options
You know you can make the monthly payments (you already do that), but where will you get the down payment for your home? How can you possibly save enough money when you’re pouring your money into rent each month?
Fortunately, you may not need as much as you think. There are many low-down payment, even a few zero-down, programs available. Ask your real estate broker for more information and get several referrals for local lending institutions. Call all the banks and mortgage companies listed in your phone book’s yellow pages and ask them about all "FIRST TIME HOME BUYER" options. Research home loans on the internet and you may be surprised at what you find.
There are also local and federal government programs designed to help renters become homeowners. Again, ask your real estate broker about these programs. A little homework can make all difference when financing your first home.2)
- Work with the sellers
Banks are a little reluctant to lend money sometimes, so ask the sellers if they’re willing to act as your lender and carry the loan. Sometimes, if you commit to pay more than the asking price – or pay a higher interest rate – sellers carrying the loan won’t require a down payment. Use the assets you already have.
If you don’t have debt and own an asset (like a car or boat) free and clear, you may be in better shape than you thought. Ask your lending institution if they’ll lend you the down payment using your asset as collateral. While this option may come with a high interest rate, it might work for you.
- Ask Friends or Family Members for Help
Most lending institutions allow borrowers to use a monetary gift for their down payment. Perhaps a friend or family member is in the financial position to help you purchase your first home. It’s worth considering.
- Keep Saving
While you explore your options, continue to save on a regular basis, even if it’s only $25 a month. Not only will this will take you closer to your goal, it will show lending institutions you have a record of responsible saving.