Are you ready to take the leap into homeownership but are held back by the daunting task of saving for a down payment? Fear not, my friend! There are options available to help you become a homeowner, including grants for buying a home and 1% down loans.
Let’s start with grants for buying a home.
Did you know that there are government programs available that offer financial assistance to eligible homebuyers? That’s right, free money to help with the down payment! These grants can come from a variety of sources, such as the Department of Housing and Urban Development (HUD) or the Department of Veterans Affairs (VA), and can make a big difference in your ability to purchase a home.
But what if you don’t qualify for a grant or need a little extra help?
That’s where the 1% down loan comes in. Yes, you read that right, only 1% down! This type of loan allows you to put down just 1% of the purchase price of the home, while the lender contributes the remaining 2% as a grant. This means you can potentially purchase a home with only 1% out of pocket.
To see if you qualify for this program go to www.newwaymortgage.com/applynow to start a secure application or call and speak to one of our mortgage experts at 916-465-6639
Let’s take a look at an example of how this could work using Freddie Mac’s Home Possible program.
Say you want to buy a home for $500,000. With a 1% down loan and a 2% grant, you would only need to come up with $5,000 (1% of $500,000) for the down payment, and the lender would contribute $10,000 (2% of $500,000) as a grant. That’s a total of $10,000 towards your down payment! Bear in mind you will still have closing costs but it’s possible to get a seller credit or even a lender credit or combo, to offset those costs.
Now, let’s talk about the elephant in the room: coming up with a down payment is the biggest barrier to homeownership. Let’s be real, who has tens of thousands of dollars just lying around waiting to be used as a down payment? I mean, we all have other things to spend our money on, like avocado toast and fancy coffee drinks, right?
Just like most things in life there is always a catch.
When it comes to the 1% down loan the catch is that your income cannot exceed 50% of Freddie Mac’s Area Media Income which in some parts of the Country are too low to be able to buy a house. For instance Sacramento, CA County income limit is $51,200 which would only get you about $265,000 in buying power. That might get you a garage in some parts, but not a house.
But in all seriousness, the struggle to save for a down payment is a real issue, and it’s one that’s preventing many people from achieving the dream of homeownership. That’s why it’s important to know about programs like grants for buying a home and 1% down loans, which can help make homeownership more attainable.
So, if you’re ready to say goodbye to renting and hello to homeownership, consider exploring your options for grants and 1% down loans. Who knows, maybe you’ll be enjoying your own avocado toast in your new home sooner than you think!
