If you’re considering purchasing your first home, the thought of saving up for all the associated expenses, especially the down payment, might seem overwhelming. This feeling could stem from the common belief that you need to save 20% of the home’s price to put down. However, this isn’t necessarily accurate.

In most cases, unless dictated by your loan type or lender, there’s typically no requirement to put down 20%. This means you may be closer to realizing your dream of homeownership than you think.

As highlighted by The Mortgage Reports:

"While it’s prudent to aim for a 20% down payment to avoid mortgage insurance, it’s a misconception that this is always obligatory. In reality, many individuals opt for a much lower down payment."

According to data from the National Association of Realtors (NAR), the median down payment hasn’t exceeded 20% since 2005. Currently, it stands at 15% for all homebuyers, and even lower at 8% for first-time buyers.

The key takeaway? You might not need to save as much as you initially believed.

Explore Available Resources to Assist You in Achieving Your Goal Down Payment Resource reveals that there are over 2,000 homebuyer assistance programs across the U.S., many of which are designed to aid with down payments.

Additionally, there are loan alternatives that can be beneficial. For instance, FHA loans allow down payments as low as 3.5%, while VA and USDA loans require no down payment for eligible applicants.

Given the abundance of resources aimed at assisting with your down payment, consulting with your loan officer or broker is the best way to discover what you qualify for. They are knowledgeable about local grants and loan programs that could offer assistance.

Don’t allow the misconception that you must have 20% saved up to hinder your progress. If you’re eager to embark on the journey to homeownership, rely on professionals to help you find the resources that can transform your dreams into reality. Delaying your plans until you’ve saved 20% could potentially result in greater costs in the long term. As stated by U.S. Bank:

"There are numerous reasons why achieving this may not be feasible. For some, waiting until they have saved 20% for a down payment may take too much time. While you’re saving and paying rent, the price of your future home may rise."

Over the next five years, home prices are expected to continue appreciating, meaning the longer you wait, the higher the price of your future home is likely to be. Utilizing these resources to purchase now will enable you to benefit from future price growth, allowing you to build equity instead of incurring additional expenses.

In summary, remember that a 20% down payment is not always necessary to purchase a home. If you’re considering making a move this year, let’s connect to initiate discussions about your homebuying aspirations.