Published October 13, 2022
Saving for a Down Payment? Here’s What You Should Know.
As you set out to buy a home, saving
for a down payment is likely top of mind. But you may still have questions
about the process, including how much to save and where to start.
If that sounds like you, your down payment could be more in reach than
you originally thought. Here’s why.
The
20% Down Payment Myth
If you believe you have to put 20% down on a home, you may have based
your goal on a common misconception. Freddie Mac explains:
“. . . nearly a
third of prospective homebuyers think they need a down payment of 20% or more
to buy a home. This myth remains one of the largest perceived barriers
to achieving homeownership.”
Unless it’s specified by your loan type or lender, it’s typically not
required to put 20% down. According to the latest Profile of Home
Buyers and Sellers from the National Association of
Realtors (NAR), the median down payment hasn’t been over 20% since
2005. There are even loan types, like FHA loans, with down payments as low as 3.5%,
as well as options like VA loans and USDA loans with
no down payment requirements for qualified applicants.
This is good news for you because it means you could be closer to your
homebuying dream than you realize. For more information, turn to a trusted
lender.
Down
Payment Assistance Programs Can Be a Game Changer
A professional will be able to show you other options that could help
you get closer to your down payment goal. According to latest Homeownership Program Index from downpaymentresource.com,
there are over 2,000 homebuyer assistance programs in the U.S., and
the majority are intended to help with down payments.
A recent article explains why
programs like these are helpful:
“These resources
can immediately build your home buying power and help you take action sooner
than you thought possible.”
And if you’re wondering if you have to be a first-time buyer to
qualify for these programs, that’s not always the case. According to an article
from downpaymentresource.com:
“It is a common
misconception that homebuyer assistance is only available to first-time
homebuyers, however, 38% of homebuyer assistance programs in Q1 2022
did not have a first-time homebuyer requirement.”
There are also location and profession-based programs you could qualify
for as well.
Bottom
Line
Saving for your
down payment is an important first step on your homebuying journey. Contact
The McLeod Group Network to get started today - 971.208.5093 or admin@mgnrealtors.com so
you have advice on how to get it ready to list, how to help it stand out in
today’s shifting market, and more.
