How Much Of A Down Payment Is Required For Buying a House?
The exact amount of down payment will determine the kind of loans that you can apply for. Normally down payment starts from 3 percent of total property’s value and it can go up to 25 percent of total price.
Tips For Knowing The Exact Down Payment Amount:
- SAVE: You can try to save from your daily expanses so that you will have more money for the down payment. Most people save a couple of years for their down payment and in some cases even for more than 2 years to increase their down payment.
- You Can Borrow Down Payment From Your Retirement Plan:
401(K) plans allows you to withdraw for a down payment or you can withdraw from an individual retirement account. Very important to make sure that you understand all of the complexities that you can face after withdrawing down payment from retirement plan and also have a repayment plan in mind because there can be few penalties associated with this action as well. - Move: Moving yourself to a less expensive house can also provide you with some additional funds for down payment.
- Try And Minimize High Interest Rate Debts.
Try and Pay off your credit cards because it effect on your savings long term. - Make a deal with the seller.
You can also request the seller to carry a second mortgage to make the down payment more feasible for you. Typically, you will pay a slightly higher rate for this second mortgage. - Sell few of your investments.
- Find a second job to increase your saving.
- Skip vacations this year.
- Cut your spending on family gifts.
- Ask your parents and other family members to help with your down payment.