It may be less than you think.
According to a recent study by Zelman and Associates, many consumers overestimate the amount of down payment they need to buy a home.
The study found that 39% of consumers believe they need to provide a down payment of at least 15% to qualify for a mortgage loan.
This common misconception may be deterring qualified consumers from buying a home simply because they believe they don’t have enough savings to make a large enough down payment.
The truth is, consumers meeting certain requirements can qualify for a conventional mortgage loan with a down payment as low as 5%. Furthermore, state and local home buyer programs (such as TSAHC’s) can help home buyers purchase a home with an even lower down payment requirement.
What Are TSAHC’s Down Payment Requirements?
Through our home buyer programs, TSAHC currently offers eligible home buyers a 30-year, fixed-rate mortgage loan that requires a minimum down payment of only 3%-3.5% (depending on the loan type). TSAHC’s programs also provide a down payment assistance grant of up to 5% of the loan amount, which home buyers can use to fully cover the down payment requirement.
When combined with a Mortgage Credit Certificate (available only to first-time home buyers), these programs can save borrowers thousands of dollars in down payment and mortgage interest costs.
Click here for more information about TSAHC’s home buyer programs and a list of participating lenders.
Should I Put Down More than the Required Amount?
Although TSAHC’s programs require a minimum down payment of only 3%- 3.5%, TSAHC encourages our home buyers to contribute additional down payment funding when possible. The National Association of Realtors provides some good information about the advantages and disadvantages of larger vs. smaller down payments.
TSAHC recommends that all home buyers contact a lender participating in TSAHC’s programs to discuss the best home loan and down payment options for their specific financial situations.
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On the House blog posts are meant to provide general information on various housing-related issues, research and programs. We are not liable for any errors or inaccuracies in the information provided by blog sources. Furthermore, this blog is not legal advice and should not be used as a substitute for legal advice from a licensed professional attorney.