How Much Do You Need for Your Down Payment?
As you set out on your homebuying journey, you likely have a plan in place, and you’re working on saving for your purchase. But do you know how much you actually need for your down payment?
If you think you have to put 20% down, you may have set your goal based on a common misconception. Freddie Mac says:
If you think you have to put 20% down, you may have set your goal based on a common misconception. Freddie Mac says:
| “The most damaging down payment myth—since it stops the homebuying process before it can start—is the belief that 20% is necessary.” |
Unless specified by your loan type or lender, it’s typically not required to put 20% down. According to the Profile of Home Buyers and Sellers from the National Association of Realtors (NAR), the median down payment hasn’t been over 20% since 2005. It may sound surprising, but today, that number is only 13%. And it’s even lower for first-time homebuyers, whose median down payment is only 7% (see graph below):
What Does This Mean for You?
While a down payment of 20% or more does have benefits, the typical buyer is putting far less down. That’s good news for you because it means you could be closer to your homebuying dream than you realize.
If you’re interested in learning more about low down payment options, there are several places to go. There are programs for qualified buyers with down payments as low as 3.5%. There are also options like VA loans and USDA loans with no down payment requirements for qualified applicants.
To understand your options, you need to do your homework. If you’re interested in learning more about down payment assistance programs, information is available through sites like downpaymentresource.com. Be sure to also work with a real estate advisor from the start to learn what you may qualify for in the homebuying process.
While a down payment of 20% or more does have benefits, the typical buyer is putting far less down. That’s good news for you because it means you could be closer to your homebuying dream than you realize.
If you’re interested in learning more about low down payment options, there are several places to go. There are programs for qualified buyers with down payments as low as 3.5%. There are also options like VA loans and USDA loans with no down payment requirements for qualified applicants.
To understand your options, you need to do your homework. If you’re interested in learning more about down payment assistance programs, information is available through sites like downpaymentresource.com. Be sure to also work with a real estate advisor from the start to learn what you may qualify for in the homebuying process.
Bottom Line
Remember: a 20% down payment isn’t always required. If you want to purchase a home this year, reach out to a trusted real estate professional to start the conversation and explore your down payment options.
Owning a home provides one of the strongest foundations for building individual wealth and lasting financial security. If you’re ready to start your path towards homeownership, talk with a trusted real estate advisor today.
If you’re thinking of buying a home, more homes are being listed for sale, and interest rates remain at historically low rates. A trusted real estate professional can answer your questions and help you determine your next steps.
Feel free to reach out to me if you have any questions about the home buying process in the East Valley. Just give me a call/text at 602-295-6807 and I will be glad to help.
Remember: a 20% down payment isn’t always required. If you want to purchase a home this year, reach out to a trusted real estate professional to start the conversation and explore your down payment options.
Owning a home provides one of the strongest foundations for building individual wealth and lasting financial security. If you’re ready to start your path towards homeownership, talk with a trusted real estate advisor today.
If you’re thinking of buying a home, more homes are being listed for sale, and interest rates remain at historically low rates. A trusted real estate professional can answer your questions and help you determine your next steps.
Feel free to reach out to me if you have any questions about the home buying process in the East Valley. Just give me a call/text at 602-295-6807 and I will be glad to help.
"Real Estate is not just a job for me, it's about making a difference in the lives of others"
Serving the Phoenix Metro, and East Valley cities including Chandler, Gilbert, Tempe, Mesa, Phoenix, Scottsdale, and Ahwatukee
Troy Erickson Realtor | 3175 W. Stephens Place, Chandler, AZ 85226 | 602-295-6807 | [email protected]
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Troy Erickson has been blogging about Arizona real estate since 2006. He is a residential real estate agent who specializes in helping home buyers, sellers, and investors in Chandler and the East Valley. He has been recognized for his local market expertise, and frequently volunteers within his community.
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