If you’re trying to buy a home for sale in Lake City or a nearby community, here’s what you need to know about down payments.
Common Down Payment Myths You Can Ignore
#1. You need 20 percent down.
FHA, USDA and VA loans – as well as other programs – let you borrow money for a home without putting down 20 percent.
The catch is, though, unless you’re using a VA loan, you will probably have to buy private mortgage insurance, or PMI. You can stop paying for PMI once you build at least 20 percent equity in your home – but every program is different, so talk to your lender about yours before you sign anything.
Related: What is PMI?
#2. Cash is better.
In many cases, buyers offer sellers cash – but those offers are usually lower than offers from people who are borrowing from a bank. Sometimes a stronger offer – and a higher offer – is what wins the seller’s interest.
#3. There’s no help available for a down payment.
There are plenty of down payment assistance programs you can apply for. While there’s no guarantee that you’ll get any help, there are:
- Community grants
- State housing agencies
- Local housing agencies
- Lender-specific Community Reinvestment Act programs
- Fannie Mae
- Freddie Mac
- Federal Housing Administration assistance programs
They all have different requirements, but if you meet them, you could be eligible for pretty significant savings on your down payment.
Check out our List of Lake City Down Payment Assistance Programs to see what’s available here.
Are You Buying a Home for Sale in Lake City?
If you’re moving to Lake City, we can help you find the perfect place to live. Call us at 386-243-0124 to tell us what you want from your home and we will begin searching right away.
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