Buying a Home with as Little as 3-5% Down Payment
October 30, 2014
Buying a Home with as Little as 3-5% Down Payment
We have recently
reported on the misconception that many buyers have regarding the down payment necessary to purchase a home. Multiple studies reveal that 40-50% of Americans believe you need between 15-20% of a down payment to be eligible to purchase a home.
This misconception came about as the government just last year debated new
guidelines for residential mortgages because of the housing collapse in 2007. Some were arguing that there should be a minimum of 20% or even 30% down payment on all mortgage loans. However,
those standards were never implemented.
To counter this misunderstanding, Christina Boyle, Freddie
Mac’s VP and Head of Single-Family Sales & Relationship Management, in a recent Perspectives explained that a person “can get a conforming, conventional mortgage with a down payment of as
little as 5 percent”.
3% Down Payments Available Soon?
Just last week, Federal Housing Finance Agency Director
Mel Watt announced that mortgages requiring
only a three percent down payment may soon be available:
“To increase access for creditworthy but lower-wealth borrowers, FHFA is also working
with the Enterprises to develop sensible and responsible guidelines for mortgages with loan-to-value ratios between 95 and 97 percent. Through these revised guidelines, we believe that the Enterprises will be able to responsibly serve a targeted segment of
creditworthy borrowers with lower-down payment mortgages by taking into account “compensating factors.”
Bottom Line
If you are saving for either your first home or that perfect move-up dream house, make sure you know all your options. You may be pleasantly surprised. Contact me directly for
a NO Cost, NO OBLIGATION review, and ask me about our “BUYER READY” program. This is so much more than a PRE-QUALIFCATION!
Gerald Santoro
Mortgage Banker
NMLS# 630694
198 Route 9 North
Manalapan, NJ 07726
732-241-4015 : Direct
866-475-3094 : e-Fax
National Direct Lender
[email protected]
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