{"id":796,"date":"2017-02-15T00:00:00","date_gmt":"2017-02-15T00:00:00","guid":{"rendered":"https:\/\/amazingproperty.com.ng\/blog\/the-big-down-payment-myth\/"},"modified":"2021-12-20T10:29:56","modified_gmt":"2021-12-20T10:29:56","slug":"the-big-down-payment-myth","status":"publish","type":"post","link":"https:\/\/amazingproperty.com.ng\/blog\/the-big-down-payment-myth\/","title":{"rendered":"The Big Down Payment Myth"},"content":{"rendered":"

\"Down<\/a><\/p>\n

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<\/p>\n

Speaking of Down Payment, Having the spare capital to put 20 percent down on a home purchase is great, but it’s certainly not the norm.<\/h2>\n

Having the spare capital to put 20 percent down on a home purchase<\/a> is great, but it’s certainly not the norm. Still, many people think it is and that belief may be holding some would-be home buyers back, particularly young adults.<\/p>\n

Indeed, 39 percent of non-owners say they believe they need more than 20 percent for a down payment on a home purchase. Twenty-six percent believe they need to put down 15 to 20 percent, and 22 percent say they need a down payment of 10 percent to 14 percent to buy, according to the National Association of REALTORS\u00ae\u2019 2017 Aspiring Home Buyers Profile report.<\/p>\n

But now for the reality: The average down payment<\/strong> on a purchase mortgage<\/a> was just 11 percent in 2016. And that’s just the average; often times\u00a0down payments are\u00a0much lower. For borrowers under the age of 35, the average down payment was just under 8 percent, according to NAR’s survey.<\/p>\n

As such, \u201caspiring first-time buyers think it takes twice as much to buy a home than\u00a0it really does,\u201d writes Jonathan Smoke, realtor<\/a>.com\u00ae\u2019s chief economist, in his latest column.<\/p>\n

How much a person truly needs for a down payment depends on their situation. Their financial circumstances, home location, and the price of the home are important factors.<\/p>\n

But there are many mortgage options that offer<\/a> the opportunity to make low or even no down payments. For example, the Department of Veterans Affairs and the U.S. Department of Agriculture offer no-money down loans<\/a> to those who are eligible. In 2016, 16 percent of buyers under the age of 35 put no money down on their home purchase.<\/p>\n

Further, the largest share of loans for buyers under age 35 last year were for people putting down less than 5 percent on a home purchase (or about $3,500). The 3 percent down payment programs backed by Fannie Mae and Freddie Mac, and the 3.5 percent FHA mortgage that primarily targets first-time buyers, are both helpful programs to consider. These loan<\/a> programs don\u2019t require unblemished credit either. The average FICO score was 713, but realtor.com\u00ae notes borrowers with a 639 were still getting approved.<\/p>\n

As such, Smoke says the millennial dreaming about homeownership needs to get this message: They need a FICO score of at least 639 and enough for a 5 percent down payment (that is, if they don\u2019t qualify for the other programs with lower payment options). In that case, they’ll need to save about $3,500 to buy in the typical American town.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Speaking of Down Payment, Having the spare capital to put 20 percent down on a home … The Big Down Payment Myth<\/span>Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":24084,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[4],"tags":[4751,518,1403,15239,625,4516,4517,4518,4519,4520,4521,4522,4523,4524,4525,4526,4542,4543,4544,4527,4528,4529,4530,4531,4532,4533,4534,4535,4545,4536,4546,4547,4537,4538,4539,4540,4541,12908,543,627,604,3058,408,1007,41,15296],"class_list":["post-796","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opportunities-in-new-markets","tag-amazing","tag-america","tag-buy","tag-chase","tag-down-payment","tag-down-payment-assistance","tag-down-payment-assistance-california","tag-down-payment-assistance-florida","tag-down-payment-assistance-grants","tag-down-payment-assistance-illinois","tag-down-payment-assistance-nc","tag-down-payment-assistance-ny","tag-down-payment-assistance-ohio","tag-down-payment-assistance-texas","tag-down-payment-calculator","tag-down-payment-conventional-loan","tag-down-payment-equation","tag-down-payment-equity-act","tag-down-payment-estimate","tag-down-payment-in-a-house","tag-down-payment-in-home-loan","tag-down-payment-on-conventional-loan","tag-down-payment-on-investment-property","tag-down-payment-on-rental-property","tag-down-payment-on-second-home","tag-down-payment-receipt","tag-down-payment-refund-law","tag-down-payment-request","tag-down-payment-required-for-home-loan","tag-down-payment-resource","tag-down-payment-resource-center","tag-down-payment-sap","tag-down-payment-savings-account","tag-down-payment-second-home","tag-down-payment-using-credit-card","tag-down-payment-when-buying-a-house","tag-down-payment-with-conventional-loan","tag-home","tag-home-buying-guide","tag-homeowners","tag-loans","tag-location","tag-mortgage","tag-owners","tag-property","tag-target"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/02\/Down-Payment.jpg?fit=1024%2C684&ssl=1","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/796","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/comments?post=796"}],"version-history":[{"count":1,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/796\/revisions"}],"predecessor-version":[{"id":90408,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/796\/revisions\/90408"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/media\/24084"}],"wp:attachment":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/media?parent=796"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/categories?post=796"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/tags?post=796"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}