Buying a Home - Magazine - Page 17
Do I Really Need a
20% Down Payment?
One thing that may be holding you back from buying right now is the idea of
saving for a down payment. Don’t let that stop you from pursuing your
homeownership dreams.
Today, there’s still a common myth that you need to
come up with 20% of the total sale price for your
down payment. The reality is – whether it’s your first
home or you’ve purchased one before – you most
likely don’t need a 20% down payment.
If saving that much money sounds daunting, you
might be ready to give up on the dream of
homeownership before you even begin – but you
don’t have to.
The 2020 Profile of Home Buyers and Sellers from
the National Association of Realtors (NAR) notes
how the median down payment hasn’t been over
20% since 2005, and even then, that was only for
repeat buyers, not first-time homebuyers.
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The most damaging down
payment myth—since it
stops the homebuying
process before it can
start—is the belief that
20% is necessary.
- Freddie Mac