If you’re a first-time homebuyer in Raleigh, saving up to purchase a home in the Triangle area can feel overwhelming—especially if you think you need to put 20% down. But here’s the good news: that 20% figure is a myth for most buyers.
Do You Really Need 20% Down To Buy a Home?
Unless your lender or loan type specifically requires it, you probably don’t need to put 20% down. Many loan programs are designed to help first-time buyers purchase with much smaller down payments.
For example:
- FHA loans allow as little as 3.5% down
- VA and USDA loans offer no down payment options for eligible buyers
While putting down more can reduce your monthly payments and help you avoid private mortgage insurance (PMI), it’s not a dealbreaker. As The Mortgage Reports explains:
. . . many homebuyers are able to secure a home with as little as 3% or even no down payment at all . . . the 20 percent down rule is really a myth.”
According to the National Association of Realtors (NAR), the median down payment for first-time buyers is just 9% (see chart below):
The takeaway? You may not need to save nearly as much as you thought.
Why You Should Explore Down Payment Assistance Programs
Even better, there are down payment assistance (DPA) programs that can help boost your savings—and most buyers don’t realize they qualify.
Believe it or not, nearly 80% of first-time homebuyers are eligible for DPA, but only 13% use it (see chart below):
These programs aren’t small, either. As Rob Chrane, CEO of Down Payment Resource, explains:
Our data shows the average DPA benefit is roughly $17,000. That can be a nice jump-start for saving for a down payment and other costs of homeownership.”
Some buyers can even combine multiple programs to maximize their benefit. That kind of financial support could make a huge difference in how soon and how comfortably you’re able to buy a home in Raleigh.
Bottom Line
Saving for your first home may seem tough—but the idea that you need 20% down is one of the biggest myths in real estate. With low-down-payment loans and down payment assistance programs available, your path to homeownership might be easier than you think.
To learn more about your options and find out what assistance you may qualify for, contact Linda Craft Team Realtors.