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is 20 persent mandatory for down payments?

  • December 15 2013 - Spring Hill
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Answers (6)

It depends on the type of loan.
  • March 18 2014
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In Citrus County Inverness, Homosassa area and the such just north of you we have the USDA loan program for rural communities and that is a no down payment program for qualified buyers.  We can see if Spring Hill would still be included.  Call more details.
  • March 18 2014
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While certainly not mandatory, the other thing to consider in regards to down payment is the loan program and the mortgage insurance being charged.  If you put down 20% on a conventional loan, you will not have any mortgage insurance.  If you put less than 20% down on a Conventional loan, you will have progressively lower mortgage insurance rates with a larger down payment.  Also, you would have lower interest rates due to the Government fees (G-Fees) with a larger down payment on Conventional. 

If you are going FHA, you can put less down, but you will have higher mortgage insurance payments each month that last for the life of the loan, not just until you reach the 20% equity threshold like on Conventional. 

Talking to a good lender will allow you to understand the best way to structure your loan.  Good luck!
  • December 20 2013
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No, 20% is not mandatory for a down payment. Depending on the type of loan the down payment can vary ( 3%, 5%, 10%, etc..)
  • December 19 2013
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Hi Eliud,

No, 20 percent is not mandatory for a down payment on a home. My realtor did recommend that I put 20% down on my first home because he knew that my conventional offer would probably be stronger than competing FHA offers, but it was my choice, not mandatory. Let me know if you have any questions about the home buying process.

Thank you!
  • December 15 2013
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20% down payment or more is mandatory when purchasing a home ONLY if you are a real estate investor or if the home will not be your principal residence.

FHA loans require 3.5% down (owner occupant)
VA loans require 0% down 
Conventional loans (range from 3%, 5% or 10% down, etc)

It would be advisable for you to sit down with or speak to a Mortgage Loan Officer via phone so that they can run your credit, check your debt to income ratio, and see which loan product best suits you.

Hope this helps at least a little bit.

Uniqca V. Powell, Realtor
Long and Foster Real Estate, Inc.
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  • December 15 2013
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