Do You Really Need a 20 Percent Mortgage Down Payment?
While many people still believe it's necessary to put down 20 percent when buying a home, that isn't always the case. How much down payment you'll need for a house depends on the loan program. While there are benefits to putting down the traditional 20 percent - or more - it may not be required.
Lower down payment programs are making homeownership more affordable for new home buyers. In some cases, you might even be able to purchase a home with use of gift funds or down payment grants.
If a borrower is short on personal funds for a down payment, certain family members can give funds as a gift to help with down payment and closing costs. If someone is interested in using gift funds as a form of down payment, it is important to talk with their lender first to make sure the funds are from an eligible source.
DOWN PAYMENT GRANTS
Down payment grants are another form of down payment assistance if you are short on personal funds. These programs often require separate approval; however, once approved through the agency you can use these funds toward down payment or closing costs.
At SFB, we assist borrowers with the entire grant approval process, so we take care of the paperwork and submit their application on their behalf. For more information about these options or any mortgage needs, please contact a member of our Mortgage Lending Team at 888-254-0615.