Buying a home can be expensive, even with the generous tax breaks that help offset mortgage payments. If you’re looking to purchase a home, you probably know it requires a significant financial investment. Thankfully, Ross Mortgage Company offers a loan program that allows for both first and repeat borrowers to put down as little as 3%. This is a great way to make home buying a little more affordable. Continue reading or talk to a licensed loan officer to learn more!
Check Your Home Purchase Eligibility
Gone are the days of needing a down payment of at least 20% of the sale price. If you don’t have that much saved you can put down 15%, 10%, 5% or even 3% down thanks to our 3% down payment option. This program allows you to start your journey in real estate with just 3% down, making homeownership more accessible.
Though not available in all areas, it’s worth exploring if you’re considering buying a home. Buyers can use this convenient look up tool to see if their desired town, address, or county qualifies for a minimum down payment of just 3%!
The 3% Down Payment Option
The HomePossible mortgage program allows new homeowners to purchase a home with just a 3% down payment, significantly less than the typical 20% required by most home loans in the United States.
The New Program
Traditionally, many buyers prefer not to make a large down payment. Ross Mortgage Company understands this and has worked to make homeownership easier for first-time buyers and low-to-moderate-income borrowers. The 3% down payment option is part of this effort. Depending on the home value, you could purchase a home with as little as $3,000 down. However, not all mortgage loans qualify for this option, so it’s essential to research and discuss with your loan officer.
Who Qualifies:
Both first-time and non-first-time homebuyers can qualify for this program if they meet specific income, credit, and geographic requirements. Generally, households earning less than 80% of their area’s median income (AMI) qualify. After researching if your total household gross income (before taxes) meets the requirements it’s best to connect with a Ross Mortgage Company loan officer to complete an application. From there your loan officer will be able to give you more details on your qualifying status and issue a pre-qualification letter.
How It’s Paid:
Ross Mortgage Company allows the down payment to come from your savings or other sources like gift funds or assistance grants. This flexibility can make a significant difference for those who may not have all the funds upfront.
Requirements for a 3% Down Payment Loan
Credit History:
A minimum credit score of 620 is required, with at least three tradelines (credit cards, student loans, auto loans, personal loans, mortgages, etc) on your credit report open for six months.
Income and Employment History:
Proof of employment history and current income is required. Self-employed individuals need to provide detailed financial information, including tax returns and W-2 forms.
U.S. Citizenship:
Borrowers must be U.S. citizens or legal permanent residents with a green card.
Property Eligibility:
The property must be a primary residence and not an investment or vacation home. It should have no history of illegal activity or foreclosure.
Debt-to-Income Ratio (DTI):
Your DTI ratio cannot exceed 50%, including all monthly debt obligations.
Online Homebuyer Education Course:
First-time homebuyers must complete an online homebuyer education course to understand the home buying process better.
Benefits of a 3% Down Payment Loan Program
3% down payment programs aim to expand homeownership in the U.S. Here are some benefits:
Purchase Your Dream Home Sooner:
With a lower down payment, you may be able to buy a home sooner than expected and have more flexibility in selecting your home and neighborhood.
Save Money for Other Expenses:
A smaller down payment frees up funds for closing costs and other transaction-related expenses.
Bottom Line
The traditional 20% down payment can be a barrier for many aspiring homeowners. Ross Mortgage Company’s 3% down payment option is designed to help more potential homebuyers enter the housing market sooner, making the dream of homeownership more attainable.
