True or False – You HAVE to have 20% Down to Purchase a Home

true or falseIt depends on who you talk to and which loan program you’re applying for ….

In a recent Wells Fargo Home Buyer survey, many myths and untruths came into light and many of them hinged on how much money was needed to have upfront when purchasing a home.

The Wells Fargo Home Buyer Survey revealed:

  • 82% of the people who responded to the survey do not spend beyond their means and know how to manage their finances.
  • 63% have funds set aside for emergencies (even the Millenials!)
  • 27% disclosed they tended to spend money without thinking (impulse purchases), but many said they thought before they spent.

These are pretty solid trends, however many still don’t have 20% to put down to purchase a home.

  • 30% of the survey takers thought only those with high incomes could begin to purchase a home with a mortgage.
  • 64% thought they’d need pretty darn good credit to purchase ….
  • HOWEVER, 50% of the home buyers surveyed didn’t think they had enough money for a 20% down payment to purchase a home!

Well, not so fast …. There are actually ways to come up with a down payment – even a 20% downpayment. And the Iowa Finance Authority has some options:

Home Financing Options

  • FirstHome Plus program: Provides up to $2,500 in cash assistance to help eligible borrowers with  entry costs including down payment and closing costs. The grant must be used in conjunction with the FirstHome program and the same income limits apply.
  • Homes for Iowans Plus program: Provides up to $2,500 in assistance to help eligible first-time and repeat home buyers with entry costs including down payment and closing costs.
  • Take Credit: Eligible home buyers may reduce their household’s federal tax liability every year for the life of their mortgage through the Take Credit program.

Please review the programs details and eligibility quick check, then contact a Participating Lender near you and ask about IFA’s programs that you could benefit from.

There is also the Cedar Rapids First – Time Buyer Program, however; according to their site, the funds are nearly out for this year – so HURRY and contact them NOW!! The next set of funds for this program isn’t expected until NEXT fall (2015).

There are also loan programs which don’t require 20% down:

There are many other down payment and loan options available, but you won’t know unless you ASK!! So if you want to know how and where to start buying your home in the Cedar Rapids and surrounding areas, contact me today. I will help you with what you need to purchase your home this fall.

Follow me on Facebook!!