Down Payment Tips

Need some inspiration and ideas for saving for a down payment? I got you covered!

1. Set up automatic transfers from your checking to your savings account each month.

2. Decide now to put aside raises, bonuses, gifts, or tax refunds.

3. Skip the costly vacation, plan a staycation, and save the difference.

4. Pare down holiday and birthday gift-giving.

5. Rent out a spare room or parking space.

6. Pick up a side hustle like freelancing, pet sitting, ridesharing, or a part-time job. Remember, it’s just until you hit your down payment goal.

While 20% down allows you to avoid private mortgage insurance (PMI) on FHA and Conventional loans, you rarely will need that large a down payment. A 3-10% down payment will put you in a strong position when you apply for a mortgage. If you haven’t quite saved enough for your desired down payment, you can tap into your 401K or TSP retirement account to help you accumulate enough funds if you choose to do so. In most cases, the funds withdrawn from a retirement account or taken out as a loan are penalty free, as long as the home is purchased as a primary residence and not an investment property. If you’re a military Veteran, you don’t need any money down and we can request the seller cover your closing costs.

Mortgage Insurance Premium

When it comes to Conventional financing, it is recommended to come up with 20% down whenever possible to avoid mortgage insurance. If you do not have 20% down, I can still help get you qualified with as little as 3%-5% down and you can eventually have the mortgage insurance premium removed, once you reach the required 20% equity to remove your PMI and lower your mortgage payment. On the bright side, the higher your credit score, the lower your mortgage insurance premium will be and you can begin investing sooner rather than later.

Have questions or want to connect about the buying process as a whole? DM me, and I’ll be in touch!