Congratulations! You’re setting out on your home buying journey. You have a plan in place and you’ve been saving for your down payment. But do you know how much you’re actually going to need for your down payment?
Hi, I’m Jennifer Prestwich, the Prestwich group at Madison Company Properties. I’ve been helping people realize their real estate dreams since 2008.
If you think you have to put 20% down, you may have set your goal based on a common misconception.
According to Freddie Mac, “The most damaging down payment myth- since it stops the homebuying process before it can start is the belief that 20% down is necessary.”
Unless specified by your loan type or your lender, it’s not necessarily required to put 20% down.
According to the profile of home buyers and sellers from the National Association of Realtors, the median down payment hasn’t been over 20% since 2005. It may sound surprising but today that number is only about 13%. And it’s even lower for first time home buyers, whose median down payment is only 7%.
So what does this mean for you? While a down payment of 20% or more certainly has its benefits, the typical buyer is putting far less down. That might be good news for you because it means you could be closer to your home buying dream than you realize.
If you’re interested in learning more about low down payment options, there are several places that you can look. There are programs for qualified buyers with down payments, as low as 3.5%. There are also options like VA loans and USDA loans that require no down payment at all for qualified applicants.
To understand your options, you need to do your homework. If you’re interested in learning more about down payment assistance programs, a good place to start would be a website like downpaymentresource.com.
Once you’re ready to take the next step, you’ll want to talk to a local lender to find out what programs are available in your area. I have several excellent lenders in the Denver Metro area that I refer, and I’m happy to share them with you. Just reach out to me.
If you’re considering buying a home this year, give me a call. I’m here to help you navigate the market no matter what your real estate goals. Hey, life is too short not to love where you live.
I’m Jennifer Prestwich, the Prestwich group at Madison Company Properties. I’m out here living the Denburbs life, and I want to help you do it too.