First Time Home Buyer: Part 6 of 8

All About Down Payments

An important aspect of getting a home loan is saving money for your down payment. You have many choices to make your home more affordable to you.

Lenders used to require a down payment of at least 20 percent of the home's price. These days, however, many lenders offer flexible home loan programs allowing you to put very little down -- three percent or less of the home price. For some buyers it's possible to buy a home with no down payment at all, or to receive help from local down payment assistance programs.

If you decide to pay make a down payment less than 20 percent, your lender may require Private Mortgage Insurance (PMI), which protects the lender in case you cannot repay the mortgage. Talk with your mortgage professional to find out the smartest deal for you.

You'll also need to pay for closing costs, which are costs associated with initiating a loan. These can include loan origination fees, discount points, attorney fees, recording fees and pre-paids. They often will total from three to five percent of the price of the home.

Once you have you down payment and loan pre-approval, it's simply a matter of finding the right house. Please call or email Mohamed Mekhimar when you're ready to take this next step towards owning your own home.