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How can I minimize the down payment for my home purchase?

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  Answers  |  1

May 02, 2016

Certainly most everyone buying prefers more home for less money. Also, most every seller wants more money for less home. Well, a lower down payment can be accomplished in many ways. Credit score, debt-to-income (DTI) ratio, loan-to-value (LTV) ratio, appraisal of the home, etc.

Now lets look at the other side of the equation - VALUE. what are you getting in return for your down payment? Also, what can you offer the note holder in return for that lower down payment?

I recently met with a newly minted (just passed the CPA exam) Accountant with 3 children. He wanted a $400,000 new-construction home for a $20,000 down payment and the seller to cover all closing costs. The lender discovered that his current mortgage was in foreclosure. Hence, the request for a 5% down payment. He is now renting an apartment while 20% of his paycheck goes toward paying off the remaining balance after foreclosure.

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