For many borrowers looking to purchase their first home, one of the biggest obstacles can be making the required down payment. You may however be surprised by how affordable your down payment could be. The following suggestions will help you to buy a home now without digging too deep into your savings.
1. Choose a loan type with a low-down payment requirement.
Another way to reduce your down payment is to pick a type of loan which does not demand that you pay a lot of money on a home upfront. With an FHA loan, your down payment could be 3.5%. An even lower down payment may be available to you with a 3% conventional loan. USDA and VA loans may have zero down.
2. Raise your credit score and improve your DTI ratio.
Down payment requirements tend to be higher for consumers who are seen as risky borrowers. You may reduce this requirement by reducing your risk profile. To do this, take steps to decrease your debt-to-income ratio while increasing your credit score.
3. Look for other ways to save money when applying for a mortgage.
Finally, even if you cannot reduce your down payment as low as you would like, you might find other ways to reduce the cost of purchasing your first home, like shopping for a home loan with low fees.
Let Maureen Martin Help You Lower Your Down Payment on Your First Home
I can assist you in finding out whether you qualify for any of the loan programs discussed above to reduce your down payment. I can also advise you on how to improve your financial metrics.
If you are ready to move affordably into a new home, please call 619} 857-7191 to schedule your San Diego first time home buyer consultation. I look forward to saving you money.