The
good news is that there are lots of folks out there who
are very interested in lending you as much as 95% of the
purchase price of your home, at very favorable interest
rates. Furthermore, they are willing to spread out the
payments over a long period of time so that you can afford
the house you want. Home loans typically are offered in
amounts of 80%, 90% and 95% of the price you are paying
for the house. You are expected to pay the remaining amount
in cash from your own funds.
The smaller the down payment, the greater the requirements
are on a buyer’s financial condition. The reason
a lender is willing to lend up to 95% of the value of
the house is that history has shown real estate to be
such an excellent investment. Lenders expect that the
home will be worth more in the future than it is today
- so their investment in your home is considered very
safe.
That's also why the interest rate you can obtain on a
home loan is one of the best around. Consider that America's
largest and strongest corporations borrow at what is called
the "prime rate," and that today you can borrow
a home loan - fixed at the same rate for many years -
at substantially less than the prime rate. Lenders have
found that home loans tend to be excellent investments,
and you benefit every month when you make your loan payment.
What if I don’t have enough for
the down payment?
Todays homebuyers have more loan options. A homebuyer
may have excellent credit and the ability to make the
monthly mortgage payment, but not have the cash for the
down payment. For this situation a nontraditional loan
program such as an 80-10-10 may be the best loan. Homebuyers
should not despair and assume that a home is out of reach.
There are many loan options available for many different
financial situations. Use our
interactive calculators or
contact us for more info on how much you need to buy
a home in San Jose, CA |
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