5 Clever Ways to get that Down Payment for a House!
Let’s face it! The idea of owning your own home can seem like a huge endeavor and coming up with the down payment might seem like a pretty steep hill to climb. Don’t despair, we’ve broken down 5 Clever ways to get that down payment for a house!
Now remember, talking to your Personal Loan Consultant should be your first step to finding out how much of a down payment you will need to buy that house. The down payment required will depend on your unique situation, as well as the type of loan that’s best for you. You will find that there are quite a few ways to amass that down payment or you may even find that you qualify for a home loan with a very low or no down payment requirement.
If you’re eager to start planning, here are five areas you should explore:
The mortgage interest that you pay on your home loan every month is deductible at tax time. In fact, up to $1 million of the interest on your payment is tax deductible. You can deduct your mortgage interest on your primary residence, as well as on a secondary residence. There are limitations, but only a relatively few are affected.
Local Down Payment Assistance Program
These city and county run programs are often the choice for people with low or moderate incomes or first-time home buyers. Do some research online for your city, county or state and see what assistance you can get. If you’re looking for a home in the Montgomery county, check out the REACH program in Rockville as well as the Homebuyer Assistance Loan Program by the City of Gaithersburg!
Do you have friends or relatives who are willing to assist with some portion of your down payment? Couples might want to set up a bridal registry which allows well-wishers to contribute. You will need documentation to prove that it is indeed a gift. Keep in mind that if gifts from one source exceed $13,000 per person or $26,000 per couple, you will be subject to federal taxes.
No we’re not suggesting hitting up your colleagues for a loan. Consider that there are sometimes options at your job for home buyers. Employers who want to recruit or keep the best employees will sometimes offer relocation assistance, offering down payment and home buyer assistance programs. Check with your human resources department to see if this is an option. Ask and you may receive.
Borrow from Yourself
Think carefully about this one as there are some pitfalls involved, but depending on your situation, it might be an option to borrow some money from your 401K or IRA. There may be penalties involved in this; drawing on this important nest egg is a big decision.
Start Seriously Saving
This might seem obvious, but it is worth considering. This is the time to look at your savings and expenses and decide what you can reduce or cut out. Perhaps it’s time to eat at home more or cut unnecessary subscriptions.
Don’t make assumptions; get the facts as it relates to your situation. Discuss your home buying goals with a Personal Loan Consultant so that you know exactly how much you need. You may qualify for a home loan that requires a low down payment or none at all!