Here’s what you need to know about saving up for a down payment.
Wondering how much you need for a down payment to buy a home? It’s a common concern, especially for first-time buyers. While common wisdom says you must save 20% of the home’s price, it’s not always the case, unless specified by your loan type or lender.
In reality, most buyers don’t put down 20%. According to the National Association of Realtors, the median down payment for all homebuyers is 15%, and for first-time buyers, it’s just 8%. Many assistance programs exist to aid with down payments, with over 2,000 programs available nationwide.
“The average first-time buyer only puts 8% down.”
Plus, various loan options offer low down payment alternatives. For instance, FHA loans require as little as 3.5% percent down, while VA and USDA loans have no down payment requirements for eligible applicants. Consulting with your loan officer can help you explore these options and uncover local grants and programs you may qualify for.
Delaying homeownership until you’ve saved 20% may not be the best financial decision. With home prices expected to rise over the next few years, waiting could mean paying more in the long run. Taking advantage of available resources now can help you capitalize on future price growth, building equity instead of facing higher costs down the line.
The bottom line: You don’t always need 20% down to buy a home. If you’re ready to make a move, don’t hesitate to call or email me to discuss your home-buying goals and explore available resources.
