It’s one of the biggest barriers to owning a home: having enough money for the down payment. Typically, a mortgage lender will require a minimum of 20% of the purchase price (unless you qualify for special financing such as an FHA Mortgage, which requires just 3% down).

 

You’ll be glad to know that there are several sources you can potentially tap in to for your down payment, besides your own wallet. Here are several of the top sources:

 

·  Family and friends: You may be surprised by how many homebuyers receive some portion of their down payment from their parents or others close to them. It’s called “gift money,” and most mortgage options allow for it. Ask your mortgage lender if you’re eligible to use gift money for part of your down payment. The amount of your down payment that can be gift money will vary based on the type of mortgage you choose.

 

·  Employer: Many employers offer down payment assistance, so check with your human resources department. Larger companies in particular may offer this assistance as part of their compensation package to attract and retain top talent. But companies of every size offer help with down payments, so be sure to ask if you’re eligible.

 

·  Local government: Many city and county governments offer down payment assistance programs. They vary widely based on several criteria. Some programs are geared specifically for first-time buyers and require homeowner education classes as part of the qualifications.

 

Other programs are tailored to buyers with low to moderate incomes. And there are other variations as well, including some programs tailored to a particular type of home or neighborhood.

 

Check with your local city or county government to determine if you, or the home you’d like to buy, qualify for a down payment assistance program.

 

·  Changes in your spending habits: How important is it to you to own your own home? The answer will determine whether you’re willing to make some changes to your current monthly budget. What could you cut or reduce to steadily accumulate the funds you need for your down payment. Think big and small: the big vacation you could put off, and the mocha in the morning that you could do without.