How are You Going to Find That Down Payment?! Use Mortgage Calculators to Plan

Small Adjustments versus Sources of Larger Amounts of Money

Most people by now understand that just eliminating a daily latte isn't going to get them into a new house. Bolder steps are required and perhaps greater sacrifices too.

Look for an FHA Mortgage

While an FHA-insured mortgage is not a source of funds, it is in effect found money because FHA mortgages require only a 3.5% down. FHA-approved lenders can finance up to caps set by the FHA depending on the type and location of the property. FHA homes must be owner-occupied. See www.fha.gov for more information and to reach out to lenders, including fha-approved mortgage lenders, fill out our form and up to four lenders will contact you.

State and Local Government Agencies

Although money is tight everywhere, check with your state, county, and city governments for grants or loans. Each program is different, but expect that there will be income caps, required financial counseling, or other criteria to qualify. Keep track of the hours it takes you to research and apply for these funds, and you may find it is the most lucrative work on an hour-by-hour basis that you can do.


There are thousands of non-profits in the U.S. From churches to Realtor associations to special interest groups such as Habitat for Humanity, and the mission of many of these organizations is to help fund housing. Start by contacting a local Realtor; he or she will probably know of several sources of help. Check out www.guidestar.org for a list of federally recognized 501(c)3s. You can search this database by location or interest.

Claim Every Tax Credit and then Use Refund

Your income tax filing may be the biggest source of cash besides your regular employment. Some tax credits are available for a limited time and are designed to stimulate the economy by enticing you to purchase something. There are tax credits if you have purchased a vehicle, made energy-related home improvements, paid college tuition, or purchased computers or Internet services. See the American Recovery & Reinvestment Act of 2009 for more information. Take whatever refund you get and stash it into a Certificate of Deposit (CD) account and let it earn interest for you. Use an online calculator to compare savings programs and to discover how soon you will have your down.

The 2009 First Time Home Buyer Tax Credit

If you close on a home before December 1, 2009, you may be eligible for the 2009 First Time Home Buyer Tax Credit. In some cases, you may be able to convert your tax credit, which can be as much as $8,000, into a bridge loan to increase your down payment, buy down your interest rate, or cover closing costs. Fill out our form to be contacted by up to four lenders who can provide more information.

Sell Something

Consider selling your car. Not only will you have a substantial lump sum, you will eliminate the insurance payment too. And you will be helping the environment. Look in your garage, attic and basement for stamp and coin collections, antiques, and other items of value. If they are not in your living space, you are probably not getting any value from them anyway; sell or consign them.

Turn Your Hobby into Income

Activities that you do for pleasure from Website design to tutoring, baking, child or animal care, writing, knitting, refinishing furniture, or translating foreign language texts all can all be inexpensively marketed locally or globally.

Change Your Living Arrangements

Radical as it may seem, consider moving to a less expensive apartment or house in your same town or to a less expensive town. You may even be able to move into a better abode and save money at the same time by taking in roommates, foreign exchange students, or foster children.

Use a Savings Calculator to Know How Soon You Will Have your Down Payment

As you stash funds into a CD or other savings account, use a savings calculator to determine how soon you will have the lump sum you need for your down payment.

Posted By :
Lorraine Watkins is a regular contributor to business and education websites. She is a notary in California specializing in loan documents. She holds an MA in English from California State University, East Bay.

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