How Much Is A Downpayment On A House

Dated: 05/16/2018

Views: 150

How Much Is a Downpayment on a House

    Before I get into how much a downpayment is, you're first going to need to know what a downpayment is. A downpayment is the amount of money you as a buyer give to the seller of the home you wish to purchase. This amount of money is a percentage of the price of the home. (The home is priced at 150k, your downpayment is 15k, you downpayment is 10% etc...etc..)The rest of the price for the home comes from money that you barrow from a lender.

CASH:

If you're paying for the home in cash, congratulations make the downpayment whatever you like

(usually 10-20%). NEXT!

 

CONVENTIONAL LOAN: 

Now for conventional loans the lender needs at least 5% of the asking price of the house as

 your downpayment (150,000 x 0.05 ).You can always pay more than 5%.

 (pay more upfront, pay less monthly)



FHA LOAN:

FHA stands for the Federal Housing Administration. To get an insured loan from them requires at least

 3.5% of the asking price for the house as your downpayment(150,000 x 0.035).  Now the FHA does 

like it when you put more money down so their offer is that if you pay 5% or more they will 

charge you less. A nice thing that separates FHA loans from private lenders is that the FHA 

doesn't charge more to people with lower credit scores. 



VA LOANS:

VA loans are loans mostly available to veterans. Now if you are a veteran I would like to say thank you

 for your service and congratulations you don't have to put any money down! That doesn't mean you

 can purchase any home, it just means you can put 0% down on a home you qualify for.


   

    So there's a brief over view of what the average home buyer should be thinking about when

 starting to look for a new home. Just take into consideration that when you put down a lot 

of money buying your new home, you will also need to have some money put aside for 

a great house warming party.                                    




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