Home Loan Downpayment Options in St. Louis, MO
By: Tim Whitmire
Yes! Buyers can purchase a home with no cash out of pocket! How much down payment should you make?
Common questions homebuyers have are: How much money do I need to buy a home? How much down payment should I make? Is it worth making a 20% down payment?
To many people’s surprise, homebuyers can qualify to purchase a home with needing no cash to close. There are two 100% loan programs. These programs are VA mortgages for eligible veterans and USDA mortgages for homes in eligible rural areas. Both of these programs require no down payment. There are still closings costs involved, but closing costs are eligible to be negotiated into the contract for the seller to pay. It isn’t uncommon for Veterans or those purchasing homes in eligible rural areas to need no money to close.
It is still possible to get into a home with no money out of pocket even if you are not a Veteran and are not buying in a rural area. This can be accomplished with both Conforming and FHA mortgages with the use of down payment assistance programs. There are down payment assistance programs in both MO & IL. There are also down payment assistance programs available through certain counties in MO & IL. You do not always have to be a first-time buyer to be eligible for down payment assistance.
Even though it is possible for many buyers to purchase a home with no money out of pocket, which can make the dream of homeownership more obtainable, making a down payment can save you money over the life of the loan. A larger down payment may allow you to reduce the amount of private mortgage insurance (PMI) you must pay or eliminate the need to pay PMI altogether. A larger down payment can also help you obtain a better interest rate on your mortgage. If you are an eligible veteran and choose to take advantage of your VA benefit of obtaining a VA mortgage, a larger down payment can reduce the amount you must pay for VA’s up-front funding fee. There can be a lot of benefits to making a larger down payment. Sources of down payment can include savings, liquidating assets, borrowing against assets such as a 401k or a vehicle, tax refunds, a bonus, inheritance, gifts from family, down payment assistance, etc.
There is a lot to consider when determining the amount of down payment you should make. We at First Integrity encourage you to ask the following questions: How much money is that larger down payment saving you? What is the source of your down payment? What is the opportunity costs incurred for the funds used to make your down payment? Is it worth making a 20% down payment? It’s important to consider all of your mortgage options and all the true costs of the down payment or lack of down payment, you choose to make. First Integrity has exclusive programs we’ve designed to meet the needs of homebuyers with all amounts of down payments. Ask how you can make less than a 20% down payment and truly pay no PMI!
- We Care enough to take the extra time necessary to make all of the mortgage programs you qualify for available to you
- We Think through the pros and cons of each mortgage option and help you make the best decisions for you and your family
- We Deliver the best mortgage experience and make buying a home fun
Our Closings are a Celebration! Not a Formality.
Call Tim Whitmire at 314.402.8184 to get pre-approved and learn about all of the mortgage options you qualify for. I can also be reached by email at timw@firstintegrity.com.