If you're thinking about buying your first home, getting together all the money you need can seem pretty overwhelming, especially when it comes to the down payment. You might have heard that you have to save up 20% of the home's price to put down, but that's not always true.

Unless your loan type or lender specifies otherwise, you usually don't have to put down 20%. This means you might be closer to buying your dream home than you think!

As mentioned by The Mortgage Reports...

““Although putting down 20% to avoid mortgage insurance is wise if affordable, it’s a myth that this is always necessary. In fact, most people opt for a much lower down payment.”
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— The Mortgage Reports

According to the National Association of Realtors (NAR), the typical down payment has stayed below 20% since 2005. Actually, these days it's around 15% for most people buying homes. For first-time buyers, it's even less at just 8%. Check out the graph below!

The main point here is that you might not have to save as much money as you first thought.

Learn About Resources That Can Help You Toward Your Goal

That's cool! Down Payment Resource mentioned there are more than 2,000 homebuyer assistance programs in the U.S. A lot of them are designed to assist with down payments.

Hey, did you know there are loan options that can be super helpful? For instance, FHA loans allow down payments as low as 3.5%. Also, VA and USDA loans don't require any down payment for those who qualify.

If you're looking for some extra help with your down payment, the trick is to chat with your loan officer or broker. They're pretty clued in on all the local grants and loan programs that could give you a leg up.

Don't stress about needing to save 20% before buying a home. If you're eager to own a place, reach out to experts who can assist you in discovering solutions to turn your homeownership dreams into a reality. Waiting until you have saved 20% could end up being more expensive in the long term. As per U.S. Bank:

““. . . there are plenty of reasons why it might not be possible. For some, waiting to save up 20% for a down payment may “cost” too much time. While you’re saving for your down payment and paying rent, the price of your future home may go up.”
”

— U.S. Bank

If you're thinking about buying a home soon, it might be a good idea to do it sooner rather than later. Home prices are forecasted to continue rising in the next 5 years. This means that if you purchase a home now, its value is likely to increase over time. So, instead of waiting and paying more in the future, buying now could help you start building equity through the projected price appreciation.

Bottom Line

You don't always have to have a 20% down payment lined up to buy a home, you know. Thinking about making a move this year? Let's chat and kick off the talk about what you're aiming for in your home buying journey.