Is Buying a Home with Little or No Down Payment Right For You?



Did you know that you do not need a down payment of 20% to buy a home? In fact, according to data from the National Association of Realtors, over half of home buyers make down payments of less than 6%. Yes, that’s correct!

Of course, the advantage of a larger down payment is the potential for lower borrowing costs. In turn, this results in a smaller monthly mortgage payment. In the end, it all depends on your specific situation.
Benefits to Buying a House with A Small Down Payment

There are some positives to buying a house with little or no down payment as well. For instance, once you make a down payment, you can only access that money via a home loan refinance or the sale of your home. With little or no money down, you avoid the risk of depleting your savings. It’s important to keep in mind that you may need some extra money for repairs and maintenance. Bottom line, you’ll always want to have some savings left after you buy.

Low or No Down Payment Loan Options are Available

There are many low or no down payment options available. What it comes down to is your eligibility. Take for example, these 2 government-insured loan programs:

Department of Veterans Affairs (VA) Loan:  VA loans are a special type of home mortgage reserved for active military members and veterans. These home loans are guaranteed by the U.S. Department of Veterans Affairs and offered by participating approved lenders such as  Emerald Home Loans. VA loans are designed to provide long-term home financing to qualified veterans and, in some cases, their surviving unmarried spouses. In many instances, their interest rates can be better than other conventional loans. Learn more about the VA Loan here.

United States Department of Agriculture (USDA) Loan: This program is offered to rural property owners with a low-to-moderate income for their area. Learn more about the USDA Loan here.

Down Payment Assistance (DPA) Programs

There are even down payment assistance programs that are designed for home buyers who can afford monthly mortgage payments but don’t have enough money for a down payment. These programs are available county-by county to offer first-time homebuyers’ relief from the costs of purchasing a home. The assistance is provided in form of a loan or grant. Learn more about NJ’s FHA Down Payment Assistance Program here.

Are You Ready to Get Started?

Emerald Home Loans is ready to help you get into the home of your dreams this year. We have many down payment assistance programs that can help you become a homeowner. Start your home buying process today by determining the annual income you’ll need to buy a house. Use our affordability calculator here.

If you’re ready to get pre-approved, you can visit us online here or give us a call 833-345-1234.

We are happy to answer any of your questions, choose the right mortgage program for you, as well as walk you through the process from start to finish!


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