So you think you cannot become a homeowner just because you do not have enough down payment? No problem, there are a lot of ways with which you can help yourself obtain a loan. And in some cases, you might even acquire a home without paying any down payment at all. Sounds good, does it not? Let’s have a look at how you can manage this.
A vice president of a mortgage lending company confirmed this and said that it was possible to buy a home even if your down payment was not big enough. However, this would be so only when your loan originator is qualified enough, guides you well and helps you in getting a loan approval. The mortgage originator would help you in figuring out the right loan for yourself and help you get the best deal.
So do you want to know how you can become a homeowner without paying a huge down payment? Here is what the industry experts have to recommend.
According to the Housing Department’s website, Federal Housing Administration or FHA loans are being utilized by many individuals to become a homeowner ever since 1934. So if you get an FHA loan, you might be able to get a mortgage even if your down payment is only 3.5% of the home’s value.
The director of a reputed mortgage firm stated that this option is particularly good for those families whose household income is low. This is not only because of the low down payment, but also because of the fact that the interest rates are also low and credit scores do not have to be that impressive.
Conventional 97 Loan
As the name suggests, the Conventional loan would provide you with a mortgage amount that is 97% of the home value. For the down payment, you would only have to pay an amount that is equal to 3%. A qualified mortgage broker stated that this option is a good choice for all borrowers who do not have enough money for the down payment but have above average credit scores.
State Specific Programs
There are many state programs that provide funds for a home if you are a first time buyer. Depending on your chosen option, the down payment can be as low as 1%. The exact details will vary with each program.