Thinking about a House in 2020?

Dated: 12/27/2019

Views: 23

Thinking about a House in 2020?

Mortgage down payment tips


1. Start saving for a down payment early

It’s common to put 20% down, but many lenders now permit much less, and first-time home buyer programs allow as little as 3% down. But putting down less than 20% may mean higher costs and paying for (PMI) private mortgage insurance, and even a small down payment can still be hefty. For example, a 5% down payment on a $200,000 home is $10,000.

Some tips for saving for a down payment include setting aside tax refunds and work bonuses, setting up an automatic savings plan and using an app to track your progress.


2. Explore your down payment and mortgage options


There are lots of mortgage options out there, each with their own combination of pros and cons. If you’re struggling to come up with a down payment, check out:

·         Conventional mortgages

that conform to standards set by the government-sponsored entities Fannie Mae and Freddie Mac and require as little as 3% down.

·         Federal Housing Administration loans which permit down payments as low as 3.5%.

·         Veterans Affairs loans which sometimes require no down payment at all.

The amount you put down also affects your monthly mortgage payment and interest rate. If you want the smallest mortgage payment possible, opt for a 30-year fixed mortgage. But if you can afford larger monthly payments, you can get a lower interest rate with a 20-year or 15-year fixed loan. Or you may prefer an adjustable-rate mortgage, which is riskier but guarantees a low interest rate for the first few years of your mortgage.


NC Housing Finance Assistance highlights and eligibility requirements


3. Research state and local assistance programs


·         Available for credit scores as low as 640

·         Get up to 5% down payment assistance on an FHA, VA or USDA loan, and up to 3% down payment assistance on a conventional loan

·         Choose among conventional, FHA, VA or USDA mortgages from private lenders, depending on loan type, buy a house, town house, condominium, duplex or new manufactured home.

·         There is no sales price limit on the home for the loan program


·         Must meet limits on income

·         Overall debt-to-income ratio has to be 43% or less The truth about-debt-to-income-ratio

·         Home buyer education may be required

·         Mortgage insurance will be required when a down payment is less than 20%

In addition to federal programs, many states offer assistance programs for first-time home buyers with perks such as down payment assistance, closing cost assistance, tax credits and discounted interest rates.


I work with wonderful lenders who can answer all your mortgage and credit questions.  If you’ve made some decisions that have negatively impacted your credit, they will develop a plan to restore your credit and get you into a home so you can start building equity.  Let my team of professionals make 2020 profitable for you.  Call today to get started.

Blog author image

Pam Liner

Pam Liner moved to Lake Norman from Asheville, NC in 1988. Together with her husband she has built five houses and manages investment property for over two decades. Raising her two children in Mooresv....

Latest Blog Posts

Kids' Rooms: Storage Solutions for Every Age

Kids' Rooms: Storage Solutions for Every AgeFrom babies who adore you to teens who ignore you, kids change — and so do their storage needs. ReadVisit for more articles like

Read More

The What and Why of Home Warranties

If you’ve only ever rented before, the necessity of a home warranty may be unknown to you. As a renter, you are used to a landlord who will fix any issues you run into - but that all changes

Read More

How to care for holiday houseplants

The holidays can be a time of stress, but your houseplants shouldn’t contribute to that. For the holiday season, your poinsettia, holiday cacti, and amaryllis only need sunlight, moisture, and

Read More

Thinking about a House in 2020?

Thinking about a House in 2020?Mortgage down payment tips 1. Start saving for a down payment earlyIt’s common to put 20% down, but many lenders now permit much less, and first-time home

Read More