Do I Really Need a 20% Down Payment?
The need for a down payment can be a major deterrent when you’re trying to buy a home. Traditionally around 20% of the total purchase price, that’s a hefty sum you need to save before you can even think about making an offer.
The good news is that not all loans require such a large down payment. Here’s what you need to know about how much of a down payment you might really need.
How Much of a Down Payment Do I Need?
Different programs require different levels of down payments.
- VA Loans: 0% down payment
- USDA Loans: 0% down payment
- FHA Loans: 3.5% down payment
- Conventional Loans: 3%-20% down payment
- Jumbo Loans: 10%-20% down payment
Talk with one of our lending professionals to get a free personalized estimate of what you might qualify for, and how much of a down payment you can expect to need.
What is Downpayment Assistance?
There are federal, state, and local programs that are designed to help first-time home buyers achieve home ownership by helping you with your down payment or closing costs. This is typically done through:
- Grants. These do not have to be repaid.
- Low- or Zero-Interest Loans. This is typically a second mortgage that is taken out on your home for the amount of your down payment. It accrues interest at a rate below that of your primary mortgage.
Home Buyer’s Gift Advantage
Often, home buyers have a family member, friend, or employer who is willing to help them out with the purchase of their home. Unfortunately, not all lenders allow this. At TILA Mortgage, however, we believe that if you have people ready to support your purchase of a home, then your lender should, too. That’s why we’ve created a special program called Home Buyer’s Gift Advantage that allows you to use gifts for up to 100% of your down payment.
Are you feeling like a down payment might be within reach? Then call one of our lending experts to learn more. You just might be closer than you realized to buying the home of your dreams!