What down payment options for a house do I have?


Lenders do require that the borrower has some equity on the house to extend the loan. The higher the equity, the lower the monthly payment.

Down payment options for a house can vary widely and those sources usually are one of the following:

  • Friends and relatives
  • 401k
  • Liquidated assets
  • Co-borrower
  • Down payment assistance programs

Other Down Payment Options For Buying A House

Lease-to-buy or rent-to-buy is a common no down payment option to get a house. However, renters are left at the mercy of the owner who could back out of the agreement if the renter is ever late, or could call suddenly and require full house price "by 2 pm on Tuesday".

Some banks would offer a no-down-payment loan as an option for a good credit borrower to get a house. Expect a higher rate with these loans as the borrower poses higher risk to the lender.

Also, a seller-held second mortgage with or without the lender's knowledge is another common practice to provide down payment for a house.

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