I recently talked to some out-of-town folks who are thinking of moving- selling their current home and buying another in the Lake Norman area. During our discussion of how they might be able to follow through on that dream, one of them expressed concern about being able to put together enough cash for their down payment. Now, lots of people have a similar concern, but I knew these folks were retired and likely had a fair amount available. I suspected that they were going on what they and I have heard in interviews of experts on national media about the down payment required for non-FHA loans. I’ve often heard that quoted as “well, we’re back to the old days when lenders required 20% down.” I kept hearing that some time ago so I called three of my local lender rep friends about this. They all said that for conventional loans, their lenders would accept as little as 5% with satisfactory credit. I told this to my friend during our conversation, and she was very relieved, seeing her plan as being much more do-able given the lower cash requirements.
As with all things having to do with mortgage loans, I pointed out that things are changing every day in the mortgage business. I told my friend that it is always best to start your research for buying a home with a call to a mortgage lender or two in order to see what’s going on in terms of down payment requirements, interest rates, ability to lock rates, and other details that are important to understanding what one can and can’t do in financing a home. She agreed to do this. I’m sure she’ll get some very useful information about her particular circumstances and needs.
More information equals fewer questions and less worry.