Saving for a Down Payment for your first Home? Here are a few strategies that will help you save faster & determine your best route to home ownership.
While there are no hard and fast rules, you can expect to pay between 5 and 10% down upfront.According to a report by the National Association of Realtors, the median down payment for first-time home buyers in 2019 was 6%.And if you’re in a competitive market, you might want to consider more.
Knowing how much you’ll need is key.Consider meeting with a mortgage officer before you start looking at property. A good mortgage broker can determine what all the costs are going to be and help you weigh your options, including how large a down payment to aim for and which loan program is your best option.
Even with no down payment, homebuyers need some cash to cover closing costs and upfront costs, including a year’s worth of taxes and mortgage insurance. Some loan programs allow buyers to use a contribution from the seller or gifts for down payments—some do not.
Now’s the time to contact an established realtor, who can conduct a needs analysis with you and put you in contact with local lenders with competitive rates.
Your goal should be to save more than the down payment amount in order to anticipate any upfront costs and allow for leverage at the table.