Around the country, the average down payment amount is decreasing and have dropped an average of about 9.2%.
Many lenders are allowing homebuyers to put 10% down or less! This can actually be advantageous to homebuyers who are trying to save to reach 20% down payment because while they are saving, interest rates and home prices are going up.
Consider this hypothetical situation:
If you put 10% down on a house that costs $200,000 now and secure a 4% interest rate, then you will pay $384,365.11 over the life of the loan.
However, if you wait a few years to save to put 20% down on the same house, which we project to be now worth $225,000, and secure a 7% interest rate, you will end up paying $455,613.79 over the life of the loan. This is an additional $200 per month for 30 years, a total of $70,000 more.
(See Zillow for more information: http://homes.yahoo.com/blogs/spaces/puts-20-down-house-not-nearly-many-might-175056896.html#more-id)
If you are considering purchasing a home and have not saved up 20% for your down payment yet, don't hesitate to talk to some mortgage brokers, lenders, and real estate agents about your options! You may be closer to getting your dream home than you think.
Feel free to contact me directly at (310) 717-1321 or JamieTian@RodeoRE.com with any questions or concerns. I would be happy to recommend to you a few lenders, or send you a list of available properties that fit your search criteria.
If you are interested in selling your home, I would be happy to provide a free professional estimate of your home value.