When you are considering purchasing a home , understanding the lending guidelines regarding a down payment is important. Here are a few key tips to consider: Gifting of a Down Payment There are some programs that will allow you to use a gift for your home down payment. However, before you assume this, make sure you talk to your loan officer. Generally speaking, the lender will require the person making the gift to provide a letter stating the money was a gift and does not require repayment. Windfalls as a Down Payment When people hit the lottery or come into money through an inheritance, … [Read more...]
How Large Of A Down Payment Do You Truly Need?
If you are interested in purchasing a home, how much money should you put down? This is a difficult question that all potential homeowners need to answer, as it will dictate the size and location of the house you can afford. There are a number of factors to consider, so what do you need to know? Generally, Putting More Down Is Better There is a solid chance that a home loan is going to be the largest loan you will ever take out in your life. Therefore, there is some risk involved, and you must make sure you can pay it back. You can reduce the risk you take on by putting more money down. That … [Read more...]
Should You Buy Mortgage Points?
When you take out a home loan, you might have the option to purchase mortgage points. Essentially, this is money that you pay to the lender upfront in exchange for getting a lower interest rate over the life of the loan. If you got a great deal on the house, you might have some extra cash on hand. Should you use that money to buy down the interest rate? This is a math problem that you need to calculate for yourself. How To Do The Math If you want to figure out if the mortgage points are worth it, you need to do some math. For example, you may need to pay an extra $3,000 at closing to qualify … [Read more...]
A Guide To Investing In Real Estate Rentals
If you are thinking about purchasing an investment property, you probably understand this is a great way to diversify your investments. On the other hand, you also need to understand how to evaluate potential rental properties and how to make sure you can generate enough income to cover the overhead expenses related to the property. What do you need to know? Pay Down Personal Debt First Before you decide to take on a second mortgage, you need to pay down as much of your existing debt as possible. If you have unpaid medical bills, student loans, and car loans, you need to pay down the step … [Read more...]
Everything Homeowners Need To Know About Down Payments
Buying a house is an exciting time, but homeowners also need to make the best financial decision to meet their needs. One of the biggest decisions potential homeowners will face is how much money to put down. A down payment is the amount of money that homeowners pay upfront when they purchase a home. Many homeowners believe they need to put down 20 percent; however, this is not always the case. What do homeowners need to know about putting a down payment on a house? 20 Percent Is Not Always Required The reason why homeowners often believe they need to put down 20 percent is that lenders … [Read more...]