Down payments are an important tool to consider when applying for mortgages as they are the amount of cash you are putting towards the home you wish to purchase, while the other portion is covered by the loan you wish to take out. As a down payment is necessary for your loan, being able to make at least a minimum down payment is critical when securing mortgage loans.
In the case of not being able to make a big enough down payment to afford a mortgage, there are a few options that you have to buy your dream home.
Usually the best option is to turn to family as they are your best support network and will more than likely be willing to help you afford your down payment. Using family support to help finance your down payment may mean the difference when securing your mortgage.
Depending on the strength of your application, you may be able to afford flex down mortgage payments, which is essentially a loan to help you make your initial down payment. This option is popular in when the borrower has outstanding credit but does not have enough cash in their pocket to afford a down payment.
How much money do you need to save in addition to your down payment?
It is important to keep in mind that down payments are not the only cost associated with buying a home. We at blink recommend having 1.5% saved for costs associated with insurance, fees, appraisals, home inspections, and/or other unexpected costs.
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