Many people believe that they can’t afford to buy a home because they can’t afford the down payment. Time and time again, I hear would-be homebuyers resign themselves to a life of renting because a 20% down payment just isn’t feasible.
However, this is one of the biggest myths of buying a home! The truth is, you do not need to put down 20% to buy a home. There are plenty of options for buying a home without a hefty down payment!
What You Need to Know
According to a recent study called “Barriers to Accessing Homeownership,” 39% of non-homeowners and 30% of those who already own a home think that they need more than a 20% down payment.
But that just isn’t true. In fact, there are a number of loans available that don’t require a down payment at all or require a very small one.
Did you know that the median down payment on loans approved in 2018 was only 5%? If you’ve spent the last couple of years saving up for your down payment, chances are you already have enough saved to buy now!
The Lowest Down Payment Loans Out There
Here are three loans that offer low to zero down payments. There are certain eligibility requirements for each, but don’t feel discouraged if they won’t work for you! Please give us a call at Linda Craft & Team REALTORS®!
Chances are, we know of the perfect solution to fit your unique situation in the Raleigh real estate market.
It’s no secret that the VA loan is one of the best mortgage loans out there. It is available to qualified veterans, active-duty service members, certain spouses, and other specific members of the National Guard and Reserves.
The VA loan features a 0% down payment and does not require mortgage insurance. It is offered through a local lender, but guaranteed by the government. The borrower does have to pay a funding fee (anywhere from 1.25 to 3.3%) that can be included in the total loan amount.
It is designed for people looking to buy a single-family residence in a suburban or rural area. The USDA has maps with specific eligibility information, so you can easily see if your property is eligible!
The USDA loan is one of the most popular loans available, and it isn’t uncommon for the total fund to run out before the end of the fiscal year. If you’re interested in using a USDA loan to buy a home in the North Carolina Triangle, check your eligibility requirements and then give us a call!
Federal Housing Administration
The FHA loan requires a minimum down payment of 3.5% and is a great option for would-be buyers that have a low credit score or history of poor credit.
While it charges a low down payment, it does require the borrower to purchase mortgage insurance upfront with a premium of about 1.75% of the total mortgage amount.
Your Dreams of Homeownership are Within Reach!
When you choose to work with Linda Craft & Team REALTORS®, you’re enlisting the help of the Triangle’s #1 real estate team. We have the resources and experience to help you buy the home of your dreams. No 20% down payment necessary!