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Tips That Will Help You Save for a Down Payment

Homeownership is the American dream, but first-time homebuyers have a lot of hurdles when it comes to making that dream a reality. One of the biggest challenges is the 20 percent down payment that is often required when obtaining a traditional mortgage.

At Goodwyn Building, we have seen too many hopefuls delay or give up their homeownership dreams because they do not have a down payment. Do not let that be you!

There are quite a few ways to get that down payment faster than you think and some nifty programs to help you out. Check out these three tips to get that down payment in-hand ASAP.

Tip 1: Ask for Seller Assistance

While certain homeowners have a set price and no wiggle room in their own budget for allowances, other sellers are more open to negotiating to get their home sold quickly. Maybe, they have inherited a property they do not want, have a deadline for their own relocation, or the real estate market is not favorable to them. In any event, there are plenty of reasons a seller may be willing to help a buyer with certain expenses, such as closing costs. Seller concessions like paying closing costs or cash credits for “repairs” that can be put off, such as upgrading flooring, puts more money in your hand for your down payment.

Tip 2: Apply for Low to No Down Payment Lender Programs

A lot of buyers assume that a 20 percent down payment is mandatory. It is not. Certain lender programs require as little as three percent down. A zero percent down payment is even possible if you qualify for mortgage programs like FHA or USDA loans.

With that said, you will want to ask if the loan requires mortgage insurance, which is a way the lender protects itself should you default early into the mortgage repayment. Mortgage insurance is tricky. In some cases, it may make the monthly note unaffordable since it can add $300 or more to your mortgage payment. It is a caveat that makes it worthwhile to shop around for the best terms and conditions from various lenders.

Tip 3: Raise the Cash with A Little Help from The Crowd

Crowdsourcing has become quite popular. You have likely heard of Kickstarter as a way for businesses to raise capital for their intellectual property or products. Well, now, you can use crowdsourcing to raise money for just about anything - weddings, birthdays, and even buying a home. Check Feather the Nest and Hatch My House to take a helping hand in your down payment efforts.

Are You Ready to Become A Homeowner?​

In closing, the above tips should show you that buying a house is never out of reach. Get creative. Do the research on loan types and novel assistance. Ask your real estate agent for leads, guidance, and local resources.

Of course, at Goodwyn Building, we also have a long-standing relationship with an array of trustworthy lenders who are always more than happy to assist our clients. Contact us today to begin your path to homeownership.

By Goodwyn Building 12-22-2020