Removing Roadblocks to Homeownership – Down Payment

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Filed under: Home Buying Tips

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Continuing with the theme of removing roadblocks to home ownership, today we are discussing the topic of saving for a down payment. A recent study noted that nearly 80% of people think a 20% down payment is required when purchasing a home.

So, I wanted to talk a little bit about this home buying myth and explore options for as little as ZERO down. The truth is that less than 50% of the home buyers have a down payment of at least 20% or more. I want to make sure that you know your options. Not only can you buy before having 20% down, but you may actually qualify for down payment assistance programs that require zero money out of pocket (including the down payment and closing costs).

Are Zero-Down Programs a Safe Option?

Some people hear this and immediately think of the loans that were done in the early 2000’s: interest-only, adjustable rates, zero down, and more. At the time, those loan options were just ticking time bombs. But the zero-down loan programs that are available now are different and offer the protection and reassurance that new homeowners need.

One of the main down-payment assistance programs is CALHFA, which is a down payment assistance with a second or even third deed of trust that will cover the down payment and/or closing costs. All rates are fixed, so you don’t have to worry about the problems with adjustable rate mortgages that happened before the 2008 crash.

Other mortgage options that you might consider are conventional or FHA loans that require 3 – 3.5% down, depending on the loan that you choose. Jumbo lenders usually offer 5 – 10% down. There are many ways to make these things work. My goal is to help with the evaluation of your situation to find the financing solutions that match your financial needs.

Don’t Wait… You Can Buy a Home Now

If you think that you have to save 20% down, then it means that you are looking at a cash sum of $80,000 – $100,000 when buying in the Temecula area. This down payment can be a big barrier to entry, which is why I am working hard to show that there are other solutions available. There’s no reason to wait until your down-payment is ready. Call me any time to explore the options. Also, remember to share, like, and comment so that your family and friends know that they have options!

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