Uncategorized May 2, 2013

You Really DON’T Need a Big Down Payment!


CORRECTION 5/3/2013:  One of my mortgage pros informed me that many good-credit buyers can get a 3% down conventional mortgage (not 5% like I first wrote here)

Stories of mortgages being hard to get are probably overblown today.  I'm not going to tell you today's lenders give away mortgages the way they did in the early days of the bubble, but I have closed more than one sale with a 3.5% down payment.  In some cases the seller also contributied ($4,000 in one case) to reduce the buyer's closing costs. 

If you have a steady job and decent (not spectacular) credit scores, you can probably qualify for a mortgagewith a lower monthly cost than rent.


1) FHA loans are still available with 3.5% down payment.  That's only $5,250 on a $150,000 home sale.  These loans are probably the largest single type of mortgage being made today.

2) VA & USDA loans require no down payment at all !   If you're a veteran, this is almost certainly available to you.  USDA has more to do with where the home is (the basic intent is in agricultural areas). 

3) Conventional loans are now available with as little as 5% down.  These will require a high credit rating, but they are being made every day.


How do you find these loans?  Use a good mortgage broker who will take a look at your personal situation and show you the dollars and sense of the various loan programs available to you.  No cost and no obligation.  I know a couple of friendly mortgage pros who have worked for my clients.  I'd be happy to give you their contact information.