Buying a home with a Small Down Payment in Marina del Rey – Marina del Rey Real Estate

Opportunities to buy a new home in Marina del Rey with a small down payment.

  • This is perfect for buyers with income and good credit but not a lot of cash.  It is a complicated topic and almost every situation is a little different but with the information below it will help to map out the process

Options for Buying a Home with a Small Down Payment:

FHA Loans

  • 96.5% Loan to Value (“LTV”) so just 3.5% down payment
  • Ex. $750,000 purchase with just $26,250 down payment
  • Condos must be FHA-approved. SFRs are easy.

Low Priced Condos that are not FHA approved…

  • 95% LTV or 5% down payment on small condo purchases (below $400,000)
  • Ex. $350K purchase with just $17,500 down payment
  • Key issue: Buyer income limited to $77K annually

80/10/10 with a HELOC

  • i.e. 80% first loan, 10% Home Equity Loan, and 10% down payment. Up to $750,000 in combined loan value.
  • Ex. Purchase $830,000 home with $664,000 1st loan, $83,000 HELOC, and 10% down…$83,500.

80/5/15 with a HELOC

  • i.e. 80% first loan, 5% HELOC, and 15% down payment.
  • Use a 5% home equity line so buyer can reduce down payment to 15% instead of 20%. Up to $1.0 million in combined loan value.
  • Ex. Purchase a $1,150,000 home with $920,000 1st loan, $57,500 HELOC, and 15% down…$172,500.
  • Same as the 80/10/10 but for loan amounts between $750K and $1.0 million

90/10 with Mortgage Insurance

  • i.e. 90% first loan and 10% down payment. Loans up to $875,000 in combined loan value.
  • Ex. Buyer purchases $900,000 home with $810,000 1st loan and 10% down…$90,000.
  • Mortgage Insurance adds to the interest rate but a buyer with good income can purchase a larger home.

80/10/10 with Seller Financing

  • Seller provides 10% loan so buyer can borrow 80% and put 10% down. Purchase price up to $1.375 million
  • Ex. Purchase price of $1.3 million. Buyer down payment of $130,000 (10%), first loan of
  • $1,040,000, and Seller note for $130,000.

These are great options for buyers with good income and credit…but not a lot of cash. Please call with your Scenarios and Questions  310-780-9396

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