Your Lake of the Ozarks Mortgage Lender: Buying a Home Without a Bunch of Cash

Friday, December 1, 2017

Buying a Home Without a Bunch of Cash

Traditionally, when buying a home, you needed to have 20% of the home purchase price saved up for a down payment. While it's still great to have that much down, as you start off with a good chunk of equity in your home, it's not completely necessary anymore. Today, there are programs available that require just 3-5% down. Today's blog from your favorite Lake of the Ozarks mortgage lender discusses buying a home without a bunch of cash.

How to Receive a Gift

One way to get a small chunk of money to build equity in your home upfront is to get it from a family member. When receiving money from someone else, it's important that you provide documentation of where the money is coming from. You have to show that it's a gift and not a loan that you're required to pay back. Make sure you don't just deposit a large sum of money into your account without any documentation of where it came from and why you got it. This will look suspicious to the lender and could cause your mortgage application to get delayed or not approved at all.

Asking the Seller for Help

Sellers can help with the closing costs in order to make the deal go through. The cash required to close on a home can be 2-5% of the home's purchase price. Your mortgage professional will provide you with an estimate of what is needed to close on the home. Your local real estate agent will then be able to help you negotiate with the seller. Depending on how motivated the seller is, they'll likely be willing to work with you. You'll never know if you don't ask. In some cases, you can walk away from the closing without having to pay anything out of pocket.

Building Your Personal Reserve

While you may not be required to have a bunch of cash upfront for a down payment or closing costs, it's still important to have some money in reserves. When buying a home, you take on a lot of responsibility that renting doesn't require. You will now be responsible for the upkeep and repairs of your home. If something breaks, instead of calling the landlord to take care of it, you have to pay someone to fix it or in some cases to replace it. The more you have in savings for the unexpected expenses of owning a home, the better off you'll be - and the better your financial picture looks in the eyes of the lender. Your mortgage lender at the Lake of the Ozarks will want to know that if any emergency situation does come up, you'll still be able to make your monthly mortgage payment.

As your local mortgage lender, I'm here to work with you every step of the way. Together, we will discuss your Lake of the Ozarks home financing options. I'll offer competitive interest rates, and back it up with the first-class service you deserve. To get started with the Lake of the Ozarks mortgage process today, give me a call at 573-746-7211 today!

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