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Greentree Mortgage Co LP
Phone: (609) 605-7153
CO NMLS ID # 16128
NMLS : ID #143589
The Benefits of Different Down Payment Amounts
Fortunately, homebuyers today don't have to come up with 20% even though it's long been considered a benchmark. What is the average down payment? According to the National Association of Realtors, in 2018, first-time homebuyers averaged a mere 7%, while repeat buyers put down about 16%.
How are the minimum down payments calculated? There are different types of loans that require different criteria.
Conventional loans. These are not guaranteed or backed by the federal government, and borrowers can often find down payment minimums as lows as 3%. Keep in mind that to receive that low of a minimum the borrower must have a good credit score and qualify for the lender's requirements..
FHA loans. These loans, backed by the Federal Housing Administration (FHA), generally ask for a 3.5% down payment. FHA loans are not as stringent when it comes to the borrowers' credit score, and lower-income borrowers can benefit from these loans.
VA loans. If the borrower is active in the military or a retired veteran, they may qualify for a U.S. Department of Veterans Affairs–backed VA loan.
While it's beneficial to take advantage of lower down payment loans if the borrower is having trouble coming up with the money or has a poor credit score, the more money a homebuyer can put down, the more benefits they receive:
Source: Nerd Wallet
If you or anyone you know has questions about home loan rates or products, please reach out. I'm always happy to help. Enjoy this month's issue of YOU Magazine.
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|Greentree Mortgage Co LP
2 Eastwick Drive, Suite 300
Gibbsboro, NJ 08026
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