Did you know that nearly 80% of first-time homebuyers are eligible for down payment assistance, yet only 13% take advantage of it? If you're looking to buy a home, addressing this gap is essential and needs your attention.

Here’s what you should know to maximize your down payment in the current housing market.

Amplify Your Down Payment Potential

For first-time buyers, the key to navigating down payments is utilizing all the available resources that can assist you. Many of these options can help you reach your goal more quickly than you might expect.

There are loan options available that only require a down payment of 3%, and some qualified borrowers, like Veterans, may not need to put any money down at all. Additionally, there are programs like grants and down payment assistance that can help you handle those upfront costs.

If you're curious about the available options that could work in your favor, reach out to a reputable lender. Not exploring what's out there could mean you’re missing out on potential savings when buying a home. These resources might help increase your down payment, which in turn could lower your future monthly mortgage payments and even reduce or eliminate costs like private mortgage insurance.

Don’t Let News Headlines About Down Payments Scare You

There's one more point to discuss. Recent news has highlighted that the average down payment is increasing. According to a report from Redfin:

““The typical down payment for U.S. homebuyers hit a record high of $67,500 in June, up 14.8% from $58,788 a year earlier . . . This was the 12th consecutive month the median down payment rose year over year.”
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— Redfin

Don't let those high numbers intimidate you. Even though the average down payment is increasing, it doesn't mean that the actual down payment requirements are going up. It's important to grasp this concept. Many buyers are opting to put down more in order to mitigate higher mortgage rates. Additionally, homeowners who are using their equity to purchase another home are also raising their down payments. As mentioned in HousingWire, this trend is shaping how buyers are approaching their home purchases.

““. . . buyers are putting down a higher percentage of the purchase price to lower their monthly mortgage payment. And buyers also had more equity from their home sales, which gives them more cushion.”
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— HousingWire

Let’s take a closer look at those two reasons:

1. Making a larger down payment can help reduce your monthly mortgage payments. With affordability becoming a concern for many buyers lately, those who can afford to put down more upfront are choosing to do so to minimize their future housing expenses.

2. Buyers who already own a home have accumulated a considerable amount of equity to work with. If you purchased a home a few years back, you’ve likely seen its value increase due to rising home prices. This gives you the ability to put down a much larger amount compared to first-time buyers who haven’t owned a home before.

Bottom Line

The best move is to have a chat with a trusted lender about your options. They can help you understand your current situation and identify any resources you might qualify for. There’s plenty of help available; you just need to partner with a professional to make the most of it.