In today’s market, the average buyer puts down about 14 percent or $32,141, according to Realty Trac analysis of 1.5 million purchased loans. Down payments in the lower priced markets are averaging about 12 percent or $8,239. While in the higher priced markets, down payments average about 24 percent or $138,547. The overall average down payment on a 30-year fixed loan increased to 17.34 percent in the second quarter (Source: Lendingtree). During the busy season (spring and summer), this generally creates more demand in the housing market which in turn causes the down payments to rise. When putting an offer in on a property, sellers will see your pre-approval letter which will indicate how much you will put down. During a bidding war, the higher down payment the more likely the seller will choose you over your competitors.
87 percent of homes will qualify for down payment assistance (Source: Realty Trac). FHA (Federal Housing Authority) loans have increased a little over 5 (five) percent over the last quarter. For first time homebuyers, FHA is still offering their 3 (three) percent down program. This program has motivated more first-timers who been on the fence about buying. Other programs include: Community Seconds, second mortgages issued by HFA (Housing Finance Agencies), Neighborhood Stabilization Program loans and grants from the community. Illinois among other states has the greatest number of down payment programs. In today’s news, IHDA is offering a new program to first time homebuyers in certain areas. This program is offering $7,500 for down payment assistance and closing cost in Boone, Cook, DeKalb, Fulton, Kane, Marion, McHenry, St. Clair, Will and Winnebago counties.
70 percent of adults are unaware of all the programs that are offered. It’s very important to make sure you are working with a lender who will tell you all about the programs you can qualify for. We don’t want you to miss out on any opportunities.