How To Buy A Dayton Home With A Low Down Payment

June 24, 2010 - PRLog -- How To Buy A Dayton or Miami County Ohio Home With A Low Down Payment

Purchasing a Dayton or Miami County Ohio home with a low down payment is important for a number of reasons, including the buyer's ability to have extra cash left over for closing costs, decorating expenses, upgrades and/or other essentials needed to turn their new house into a home. Thanks to the level of competition between mortgage lenders, it's now easier than ever to buy a home with a low down payment.

First-Time Homebuyers

There are a lot of perks to being a first-time homebuyer, including the ability to get in the door with a low down payment.  Many lenders will ask for a down payment as low as five percent (three and one half percent for FHA loans) to those looking to purchase their first home. There are also many special programs available to first time home buyers. Contacting your local Dayton and Miami County Ohio REALTOR or lender is a good first step.

A first-time homebuyer is someone who has rented their previous home(s) or has never purchased a house on a permanent foundation. Individuals who have owned manufactured homes may also be eligible for a first-time homebuyer loan, but the final decision is up to each individual lender. You will find that different lenders will offer different programs so talking with more than one can be beneficial.

FHA Loan

This type of loan is guaranteed by the Federal Housing Authority (FHA) and allows for a smaller down payment than many conventional loans. In addition to offering down payments as low as three percent of the total purchase price, FHA loans often carry lower interest rates and are easier to qualify for. This type of loan is ideal for first-time homebuyers, individuals with past credit problems or even those who wish to purchase a second home.

Provide Your Land As Collateral

If you own the land that you intend to build on, many lenders will use the land in place of a down payment. In other words, you build a house on the land that you already own, and the lender gets both if you default. This is why individuals who own land often choose to build, while using the lot in place of a big down payment. In addition, many lenders are more willing to approve a loan if the land is already owned by the buyer.

Owner Financing

When a seller lists their home, they have the option of considering owner financing. In this situation, a buyer provides a down payment to the seller and signs an agreement to pay for the home (plus interest) over a preset number of years. Owner financing can sometime require a lower down payment, which can be any amount that the buyer and seller agree to. Because there is no bank qualifying and no credit check, a seller can extend the offer on any terms that they wish. When there are an abundance of houses on the market, this may be an attractive option to sellers looking to sell their Dayton or Miami County Ohio home quickly.

Depending on whether you looking to live in the city or the county, be sure to check with your local Dayton and Miami County Ohio REALTOR or lender to understand your options.

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About Greg Greenwald: Greg is a Realtor with Prudential One in Troy, Ohio. He's a member of GDREIA (Greater Dayton Real Estate Investors Association) who helps beginning and seasoned investors alike. Greg's education began at Sinclair Community College studying Real Estate and Property Management and continues today personally studying under some of the top Real Estate experts in the county. Greg commits to providing his clients with uncompromising personalized service. Call Greg today at (937) 573-6917 or visit http://www.greggreenwald.com