If you don’t have a 20 percent down payment, look at other options.

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Think it’s impossible to buy a home unless you have 20% saved up? Maybe not. Low down payment options may be more common than you think—if you know where to look.

Certain loans allow you to put down 3% down, or even less!

In addition, you may be able to use a government or nonprofit program to get help with your down payment or other upfront costs.

Lender-specific loans
You may be able to lower the amount of funds needed for a down payment or closing costs. Some of these loans may require PMI. Ask your lender if the funds may come from gifts, grants or homebuyer assistance programs.

Federal Housing Administration (FHA) loan
Allows a down payment as low as 3.5%. You pay an upfront amount for mortgage insurance and annual insurance premiums.

VA loan
Veterans may qualify for a 0% down loan.

USDA loan
These are 100% loans available in certain areas.

Ask your Realtor or lender about down payment or cost-saving programs to help offset upfront costs.
You may need to take a homebuyer education course or stay in the home for a certain number of years to be eligible for these programs, which may be offered by:

  • State or local housing agencies
  • Nonprofit organizations
  • Your employer, if you work for a large company or public institution

Your eligibility might also depend on:

  • The type of mortgage
  • Your household income
  • Your credit score
  • The property location

Combining a low-down-payment loan with one or more homebuyer assistance programs can reduce the cash you need to close, so you have more savings for:
Home maintenance
Car repair
Health emergency
Other surprise needs

A low-down-payment strategy may help you buy your home, but it means you have less equity, your monthly payment will be higher and you may pay more interest over the life of the loan. However, it dos allow you to get into your own home and start enjoying the advantages of homeownership.

It’s best to do research and compare your options. Speak with a lending specialist to prequalify and find out how much you will need for a down payment on a home you can afford.

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About Dana Ash-McGinty 172 Articles
Dana Ash-McGinty is the Principal Broker of ASH | MCGINTY, a Washington, DC Real Estate Brokerage. This real estate maven has 15+ years experience in residential, commercial and land sales in addition to multi-state residential renovation, re-zoning, and condo conversion projects. A sought after real estate authority, she has been featured on CNN and in various real estate and financial publications. Dana is married to the highly esteemed Dr. Dana W. McGinty, a Washington, DC based internal medicine physician. They are often referred to as "The Danas".

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