How Much Down Payment is Needed to Purchase a Home?
Although each lender has a specific requirement for determining your down payment, there are some common
factors that lead to their decision. These factors are the purchase price, the length of the loan, your credit
rating and whether you are a first-time buyer.
For conventional mortgages, down payments are normally 20% of the purchase price. These loans are targeted to
buyers that currently have a home and want to upgrade. These are not the only loans available.
It is possible to reduce your down payment below the 20% range. For example, government-insured mortgages such
as those offered by the Colorado Housing and Finance Authority and the Veterans Administration can help you achieve
a lower down payment rate. First-time home buyers can find low down payment programs with local housing agencies and
some commercial lenders.
Other options for lending and getting a great deal on your down payment can be achieved through your local credit
union (if you belong to one). This type of funding varies with the credit union involved, your credit history, and
your length of service with the company.
Don't be satisfied if the first mortgage company requires a large down payment. Research other options until you
find one that suits your personal needs. There are a large number of lenders that all want the possibility of funding
your new home. Spending time locating the right lender will mean whether you are happy and secure in your home or
always on edge.
Working with a variety of lenders gives the agents at The Berkshire Group an excellent perspective of financing and
the best programs and lenders available. We stress to home buyers the importance of working with a credible
lender, one who can be counted on to tell you the truth, meet deadlines with serious determination and to
deliver the funds when it comes time to close. Many lenders can claim this, but don't deliver the goods...It's best
to ask for a reference when letting someone handle so much of your money.
At The Berkshire Group, Realtors we don't take or offer "kick-backs". We prefer to provide unbiased real estate advice,
with your best interest at heart. Dew Bugus you will see!
Resources
Colorado Housing and Finance Authority: www.colohfa.org
Consumer Information Center: www.pueblo.gsa.gov
Fannie Mae Foundation: www.homepath.com
Home Advisor: www.homeadvisor.com
Manufactured Housing Institute: www.manufacturedhousing.org
Mortgage Bankers Association: www.mbaa.org
U. S. Department of Housing and Urban Development:www.hud.gov
