Do you need to buy a new home, but are concerned with your finances? No worries, here are ways you can buy a home on a low budget.
Buying a home is a big commitment.
But home ownership is still a dream for many Americans.
2017 was one of the best years on record for US home sales, with the total number of homes sold jumping over 7% above homes sold in 2016.
Even in a booming market, the prospect of coming up with a down payment and committing to a mortgage are intimidating commitments to many potential buyers, especially those on a budget.
Not sure if there’s room in your budget for home ownership?
Keep reading for a quick look at how you can buy a home, even if you’re on a low budget.
Buying a Home on a Low Budget–If You Don’t Ask, You’ll Never Know
Believe it or not, there are a surprising number of home buying options for buyers on a budget.
Having a lower budget can make the home buying a bit more difficult in a number of ways, but it’s definitely not impossible. People do it every day.
Even if you don’t meet some of the traditional requirements for a home loan like having 20% to put down or a higher debt to income ratio, options are out there you just need to ask.
Before you write off your chances of getting a home loan, check with a mortgage professional and see what options are available. You might be surprised what you’ll find.
FHA Loans
One great loan option for low budget buyers are FHA loans.
FHA loans provide a way for first-time buyers to get into a home with a minimal down payment of just 3.5% with qualifying credit.
Backed by the federal government, FHA loans are secure and generally provide good interest rates.
USDA Loans
If you live in or want to buy in a rural area, USDA loans can be very helpful to lower budget buyers.
USDA loans allow qualified buyers to purchase property with little to no down payment. You’ll just need to buy in an approved area and have an acceptable debt to income ratio.
VA Loans
Veterans Affairs loans provide assistance to active duty or retired US military personnel.
With a VA loan, qualified buyers can purchase a home with no money down and very low interest rates.
If you can qualify, VA loans are a tremendous opportunity to get into a home, even with a lower budget.
Other Mortgage Programs
There are a number of other loan programs for lower-income buyers available at the local level.
Many cities and counties run programs to help first-time buyers or low budget purchasers. If none of these other programs work for you, check with a local loan officer to see what other types of loans you might qualify for.
Putting it all Together
Buying a home can be a big commitment. But it’s not impossible.
If you find yourself at the lower end of the budget spectrum, options are available. You just have to find them.
For more on finding the right home–and the right mortgage program–check out the rest of our blog.
