Buy a Home in 2021 with Less Than 20% Down

Jan. 31, 2021

In 2021, do you know how much money you need to save to become a homeowner? The down payment, or cash you pay upfront, is often the biggest roadblock to buying your first home. Conventional mortgages typically require 20% down, which can make buying a home seem impossible.  If you save $200 per month, it would take over four years to save up a $10,000 down payment. But, you could buy a home with 0% – 3.5% down and use Down Payment Assistance (DPA) of up to $10,000 to cover closing costs.

There are several types of mortgages available that require less than 20% down:

  • US Federal Housing Administration (FHA) loans typically require only a 3.5% down payment.
  • Veteran’s Administration (VA) and US Department of Agriculture – Rural Development Guaranteed Housing Loan Program (USDA) loans have no down payment requirement.
  • Some conventional mortgages are available with minimum down payments as low as 3%.

NeighborWorks Umpqua has HUD certified housing counselors on staff to help you better understand the options and provide a Down Payment Assistance Loan if you qualify.

So, how does Down Payment Assistance work? Up to $10,000 in DPA is money is available to you as a low-interest loan, which provides first-time homebuyers with some or all of their down payment or closing costs. When added to the down payment savings, you already have, DPA can give you the necessary bump you need to buy your house now or give you the extra edge to make your offer more competitive.

Down Payment Assistance Loans have no interest and no monthly payment: you do not have to repay the loan until you move, sell, or refinance. This is a very low-cost loan, which won’t burden your monthly budget, and can help propel you into the home you need now.

A larger down payment will help decrease the total costs of your loan and may help keep your monthly payment low. So, even if you have enough savings to meet the minimum down payment required for your mortgage, a DPA loan can help by covering closing costs or increasing that down payment to bring your monthly bill down. If you don’t already have enough saved up to meet the minimum down payment requirement, our DPA loan can help get you there.

In 2021, your first home may be more affordable than continuing to rent. Mortgage rates remain low, and home prices are likely to increase more slowly than last year. Let us help you achieve homeownership faster with up to $10,000 of a no-interest, no-monthly payment DPA loan.

First-time homebuyers in Coos, Curry, Douglas, Klamath, and Lake Counties are eligible through the end of this 2021 – or as long as funds are available.

Find out if you qualify.

Veterans: Up to $10k is available in down payment assistance loan money
  • No-interest loan
  • No monthly payment: payments not due until you sell your home

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