When you want to get the best home loan deal, you will need a high FICO credit score and a 20 percent down payment on your loan. You can take out a mortgage with less than 20 down, but you will have to pay for private mortgage insurance in addition to your actual loan. At the same time, you will have a higher interest rate.
But there are great ways to make the process easier and more convenient. Altius Mortgage Group shares some tips on how to find the best mortgage rate for a home in Salt Lake City.
Save Up or Ask For Assistance
To find a convenient mortgage rate, you will need that 20 percent down payment. Most homebuyers lack the resources to cover such an amount, which is why financial experts suggest that you save up. Otherwise, you can simply get down payment assistance.
Assistance With the Down Payment
Down payment assistance (DPA) can help you and other homebuyers afford the down payment on a home loan. While the programs will not completely grant you the needed down payment money, the amount you still need to save up will be significantly reduced. These programs abound nationwide, numbering at around 2,200.
Savings from the Programs
People who have availed of these programs have enjoyed savings of $17,766 on average over the entire duration of their home loan. These savings come from having to owe less on the loan. At the same time, with a great interest rate, you pay less towards interest. You also have lower monthly payments overall.
Types of DPA Programs
When you apply for a DPA program, you may or may not have to pay for the assistance. DPA can come in the form of second mortgages, deferred second mortgages, forgiven second mortgages, and grants that you don’t need to pay back. In Utah, you can enjoy the DPA program under the Utah Housing Corporation.
A DPA program may be what you need to make the 20 percent down on that home loan. You can then enjoy savings at the same time as you buy your dream house in Salt Lake City.