Coming up with that down payment : Rooftop Views

Rooftop Views

Coming up with that down payment

Believe it or not, a majority of respondents paid for the down payment on their first home with personal savings according to the Coldwell Banker 2006 Homeowner Annual Survey. According to this survey, only 16% of respondents took advantage of "no money down" home loans for their first home.

By the time respondents purchased their second home, most were able to use profits from the sale of their first home as down payment on the second. Even with the incredible cost of housing in some markets today, an amazing 81% of respondents in this survey do not consider themselves "house poor". Almost 60% indicated they used 34% or less of their current income on house payments.

Respondents in this survey all made $75,000 or more per year. We suspect that for buyers making less per year the percentage of those using "no money down" loans would increase substantially. A large majority of the buyers who purchase those foreclosed homes that we list use either "no money down" financing or both a first and second mortgage in order to avoid making a down payment. Only when an investor purchases one of our foreclosure listings do we see any sort of cash down payment.

According to the survey, 60% of respondents who are Baby Boomers or older said they planned to bequeath their homes to their heirs. Only 10% of those 41 or younger said their primary residence factored into their estate planning.

Coming up with a down payment can be the most difficult part of purchasing your first home. Using "no money down" loans is certainly one way to purchase the home of your dreams.