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3 Exceptional Ways to Buy a Home with Less Down Payment

By House and Home Co. / Published on Thursday, 07 Apr 2016 21:33 PM / Comments Off on 3 Exceptional Ways to Buy a Home with Less Down Payment / 110 views

Home with Less Down Payment in AmericaAn adequate down payment is often the single, huge hurdle that keeps you from buying a house. Lenders would, of course, take a 360-degree view of your credentials, but even if you have a decent credit score and a low debt-to-income ratio, failing to meet the strict loan-to-value requirements of conventional mortgage providers could keep many loans and low-interest rates out of your reach.

Fortunately, Hedgecock Group Real Estate says, you have plenty of options to save up the thousands of dollars you need for your down payment. If the money you borrowed from your friends and family, and even your retirement plan, still isn’t enough, these desperate measures might bail you out in these desperate times:

Open Yourself to Investors

Shared equity is beginning to gain traction as of late. This financial product lets you receive cash contribution for additional down payment in exchange of a share of your house’s ownership.

The number of investors seeing the potential in this arrangement is increasing, especially those trading in crowdfunding facilities.

Although this concept isn’t new, shared equity is yet to win general acceptance among lenders and regulators. But once the demand further rises and the industry begins to pay more attention to create guidelines for homebuyers and investors, equity financing could definitely make home ownership easier to realize.

Consider Co-Buying a House

Buying a house with a friend, or a non-spouse for that matter, is becoming more popular among down payment-troubled homebuyers in America.

Particularly in Alaska, aspiring homeowners split everything, from the down payment to monthly repayments, to buy the most sought-after homes for sale in the North Pole that are otherwise a bit too costly for just one person.

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If you want to enter into this kind of agreement with someone else, consult a real estate expert to recognize its possible challenges and clearly defined the rights and responsibilities of each other.

Trade Up

If you can be more patient, it might pay to just settle with a house you can afford right now before going after the home of your dreams. Buying a property in a rising real estate market allows you to grow your money thru appreciation.

Your small down payment becomes a leveraged investment can increase tenfold over the years, which you can then use to buy the property you really want.

A large-enough down payment isn’t just going to fall from heaven. It takes time and a series of sound decisions to ensure you have an adequate amount to make the mortgage a less risky transaction for both you and the lender.