Saving for a Down Payment? Here’s What You Need To Know.

If you're planning to buy your first home in Oklahoma, then you're probably focused on saving for all the costs involved in such a big purchase. One of the expenses that may be at the top of your mind is your down payment. If you’re intimidated by how much you need to save for that, it may be because you believe you must put 20% down. That doesn’t necessarily have to be the case. As the National Association of Realtors (NAR) notes: “One of the biggest misconceptions among housing consumers is what the typical down payment is and what amount is needed to enter homeownership.” And a recent Freddie Mac survey finds: “. . . nearly a third of prospective homebuyers think they need a down payment of 20% or more to buy a home. This myth remains one of the largest perceived barriers to achieving homeownership.” Here’s the good news. Unless specified by your loan type or lender, it’s typically not required to put 20% down. This means you could be closer to your homebuying dream than you realize. According to NAR, the median down payment hasn’t been over 20% since 2005. In fact, the median down payment for all homebuyers today is only 14%. And it’s even lower for first-time homebuyers at just 6% (see graph below): What does this mean for you? It means you may not need to save as much as you originally thought. Learn About Options That Can Help You Toward Your Goal And it’s not just how much you need for your down payment that isn’t clear. There are also misconceptions about down payment assistance programs. For starters, many people believe there’s only assistance available for Oklahoma first-time homebuyers. While first-time Oklahoma buyers have many options to explore, repeat buyers have some, too. According to Down Payment Resource, there are over 2,000 homebuyer assistance programs in the U.S., and the majority are intended to help with down payments. That same resource goes on to say: “You don’t have to be a first-time buyer. Over 38% of all programs are for repeat homebuyers who have owned a home in the last 3 years.” Plus, there are even loan types, like FHA loans with down payments as low as 3.5% as well as options like VA loans and USDA loans with no down payment requirements for qualified applicants. If you’re interested in learning more about down payment assistance programs, information is available through sites like Down Payment Resource. Then, partner with a trusted lender to learn what you qualify for on your homebuying journey. Bottom Line Remember, a 20% down payment isn’t always required. If you want to purchase an Oklahoma home this year, reach out to a trusted real estate professional to start the conversation about your homebuying goals.

View more

How To Make Your Dream of Homeownership a Reality

According to a recent Harris Poll survey, 8 in 10 Americans say buying a home is a priority, and 28 million Americans actually plan to buy within the next 12 months. Homeownership provides many financial and nonfinancial benefits, so that interest is understandable.   However, it’s unlikely all 28 million Americans will accomplish that goal in the coming year. Experts project a total of around five million homes will be sold in 2023. Why is there such a big difference? It’s partly because there can be challenges to buying a home in Oklahoma.   In the same survey, when asked, “Which of the following are preventing you from pursuing homeownership at this time?”:     34% answered, “I don’t have enough saved for a down payment”     30% answered, “My credit score”     If you’re aiming to buy a home in Oklahoma, here’s what you need to know to accomplish that goal. Save for Your Down Payment Your down payment is a big chunk of what you pay up front for your home. For most home purchases, Oklahoma buyers put down some amount of cash up front (a down payment) and then take out a loan (a mortgage) to pay for the rest.   It’s a longstanding myth that you need to pay 20% of the purchase price for your down payment. In reality, 20% down isn’t always required. In fact, according to the National Association of Realtors (NAR), today’s median down payment is 14% for the average buyer and just 6% for a first-time buyer.   Regardless of how much money you can save for your down payment, know there’s help available. A local lender can show you options to help you get closer to your down payment goal. Plus, there are even loan types, like FHA loans, with down payments as low as 3.5% for some buyers, as well as options like VA loans and USDA loans with no down payment requirements for qualified applicants.   Beyond assistance programs and different loan types, here are a few other tips to help you as you save for your down payment:     Remember to factor in closing costs. In addition to your down payment, closing costs are usually 2-5% of the home's purchase price.     Maintain your savings. Your down payment shouldn’t deplete all your savings. It’s important to still have some money set aside for homeownership expenses after you move in.     Explore your options and lean on your trusted advisor for expert guidance. Do your research, ask questions, and look into the resources available for buyers like you.     Improve Your Credit Score Your credit score is a number that indicates how financially reliable you are to lenders. A higher credit score usually means you’ll be able to borrow more money at a better interest rate. If your credit score is preventing you from getting an affordable mortgage, there are steps you can take to improve it. Here are two:     Pay your bills on time. When you pay your bills on time, your credit score improves. When you’re late, it takes a hit. One way to make paying your bills on time easier? Set up automatic payments when and where you can.     Mix it up. From auto loans, to credit cards, to mortgages – there are several different types of credit. And having a mix of them improves your credit score.       Bottom Line If you want to purchase a home in Oklahoma this year, let’s connect so we can start preparing.

View more

You May Not Need as Much as You Think for Your Down Payment [INFOGRAPHIC]

    Some Highlights Many people believe you need to put down 20% of the purchase price when you buy an Oklahoma  home. But recent homebuyers actually put down far less on their purchase. And with programs like FHA loans, VA loans, and USDA loans, some qualified buyers are able to put down as little as 0-3.5%. Let’s connect to make sure you have a trusted lender and can find out if you’re ready to buy a home in Oklahoma sooner rather than later.

View more