Your Down Payment

Lots of folks who are looking to purchase a new house can qualify for various loan programs, but they don't have much to put up a down payment. Here are a few straightforward ways to put together a down payment

Tighten your belt and save. Look for ways to reduce your expenses to put away money for a down payment. You also could enroll in an automatic savings plan to automatically have a set amount from your take-home pay moved into a savings account. You would be wise to look into some big expenses in your budget that you can do without, or trim, at least temporarily. For example, you might move into less expensive housing, or skip a family vacation.

Work a second job and sell things you do not need. Look for an additional job. This can be rough, but the temporary trial can provide your down payment money. You can also seriously consider the possessions you actually need and the items you can sell. Maybe you own desirable items you can put up for sale at an online auction, or household items for a garage or tag sale. Also, you might want to look into selling any investments you own.

Borrow from your retirement funds. Check the provisions of your specific plan. You may borrow funds from a 401(k) plan for a down payment or withdraw from an IRA. Be sure you comprehend the tax consequences, your obligation for repaying funds, and any early withdrawal penalties.

Ask for a gift from family. Many homebuyers are often lucky enough to receive help with their down payment assistance from caring parents and other family members who are anxious to help get them in their own home. Your family members may be willing to help you reach the milestone of buying your first home.

Contact housing finance agencies. Provisional mortgage loans are provided to buyers in specific circumstances, such as low income homebuyers or future homeowners looking to remodel homes in a targeted area, among others. Financing through a housing finance agency, you may get a below market interest rate, down payment assistance and other benefits. These kinds of agencies can help you with a reduced rate of interest, help with your down payment, and offer other assistance. These non-profit programs to build up community in specific places.

Learn about low-down and no-down mortgage loans.

• Federal Housing Administration (FHA) mortgages

  The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in aiding low to moderate-income individuals qualify for mortgages. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA assists first-time homebuyers and others who would not be able to qualify for a traditional loan by themselves, by providing mortgage insurance to private lenders. Down payment totals for FHA mortgages are lower than those with conventional mortgages, even though these loans hold average interest rates. Closing costs might be financed within the mortgage, while the down payment could be as low as 3 percent of the total amount.

• VA mortgages

  Guaranteed by the Department of Veterans Affairs, a VA loan assists service people and veterans. This special loan requires no down payment, has minimal closing costs, and provides a competitive interest rate. Even though the VA doesn't issue the mortgage loans, it does issue a certificate of eligibility to apply for a VA loan.

• Piggy-back loans

  A piggy-back loan is a second mortgage that you close with the first. Usually the first mortgage covers 80% of the cost of the home and the "piggyback" is for 10%. The homebuyer pays the remaining 10%, rather than come up with the usual 20% down payment.

• Carry-Back loans

  With a carry-back mortgage, the you borrow part of the seller's home equity.. The buyer funds most of the purchase price with a traditional mortgage program and borrows the remainder from the seller. Usually you'll pay a slightly higher interest rate with the loan financed by the seller.

No matter how you gather your down payment, the thrill of reaching the goal of living in your own home will be just as sweet!