Looking to make your next real estate investment? If you don’t own a house yet, you’re missing out. Being a homeowner means you get a sense of security and belongingness that cannot be found anywhere else. It is a valuable investment made for the future and is a smart way to build wealth.
If you own a house, you will be more community-oriented, save tax and also provide stability to your family. You can search for the top properties in Hilton Head on https://www.thepattisallgroup.com/ anytime you want. However, the one thing that you do need first before buying your home is the down payment.
Yes, saving enough money to make the down payment to buy a house seems to be the biggest hurdle an individual faces. The amount of money you need to have as the down payment can seem significant. Don’t worry, a few strategies can help you out.
4 Tips to help you buy the property you’re looking for:
Here are a few tips to help you finance your next home, even if you are low on your down payment.
You Don’t Need 20% for Down Payments
It is actually a myth that you have to pay 20% of the total value as down payment. Lower down payments can also be made; you just have to look at the right place. If the mortgage is insured, mortgage lenders give home loans at as little as 3% to 5% down payment.
Look for Low Downpayment Mortgages
These kinds of down payments are actually becoming popular day by day as they free the homeowner from the burden of accumulating and spending a huge sum of money at one go. In order to get the best available prices and terms, one should meet several lenders and compare the rates and types of mortgages offered by them.
You Can Look for Mortgage Insurance
Mortgage insurance is the key to making low down payments. If a homeowner suddenly stops or refuses to make monthly payments, it is the mortgage insurance that protects the mortgage lender from incurring any financial loss. There are two ways in which low down payment mortgages can be insured, namely government or private sector.
In case the homeowner doesn’t pay, a default takes place with the home going into foreclosure. All the money invested by the homeowner in the house is lost by him including the house. The mortgage lender receives the claim on the defaulted loan by the insurer.
Check if your Qualify for a Low Down Payment Loan
To get a low down payment loan, you must fulfil the below-mentioned criteria. First, you need to have enough income to support the monthly mortgage payments and enough cash in hand to pay the down payment. Having a good credit score which shows your payment history and indicates your willingness to pay is of great help when applying for the loan.
A sufficient appraisal value showing that the price of the house is at least the same as the purchase price is important.
Also, you should be able to cover closing costs and related expenses. Ensure that you can manage the above, as a failure in providing any of these criteria may result in your low down payment loan application getting rejected.
Did you find it difficult to save up for the down payment of your mortgage?
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