When it comes to buying your first home, one myth has stopped countless dreams in their tracks: the idea that you must have 20% of the home’s price saved as a down payment. If this belief has ever crossed your mind, you’re not alone. But here’s the truth—it’s simply not true.
At Martini Mortgage Group, we’ve helped countless aspiring homeowners overcome this outdated idea. Let’s bust this myth wide open and explore why waiting to save 20% could cost you more than you realize.
Where Did the 20% Myth Come From?
The notion of a 20% down payment stems from a time when financial advice was one-size-fits-all. Back then, putting down 20% helped avoid private mortgage insurance (PMI) and kept monthly payments lower. While these benefits are valid, they don’t tell the whole story.
Today’s housing market is anything but cookie-cutter, and your homebuying journey should reflect your unique goals, financial situation, and timeline.
What’s the Reality for Raleigh First-Time Home Buyers?
Most first-time buyers don’t wait to save 20%—and for good reason. According to the National Association of Realtors, the average down payment for first-time buyers is closer to 6%. Waiting to save 20% often means missing out on the benefits of homeownership, like building equity and locking in today’s home prices and interest rates.
Here’s a scenario to put this into perspective:
Imagine you’re eyeing a $300,000 home and want to save 20%—that’s $60,000. If you save $1,000 a month, it will take you five years to reach your goal. But in five years, that same home could cost $350,000 or more. Meanwhile, buyers who acted sooner are already building wealth through equity.
Options for Buying a Home with Less Than 20%
The good news? You don’t need 20% down to buy a home. Here are some popular low-down-payment options offered by the Martini Mortgage Group:
FHA Home Loan
- Requires as little as 3.5% down.
- Available to first-time and repeat buyers.
- Martini Mortgage Group even offers a proprietary no-down-payment FHA solution—contact us to learn more!
Conventional Loan
- Down payments as low as 3%.
- Ideal for buyers with strong credit who want flexibility.
VA Home Loan
- Requires zero down payment.
- There is no loan limit.
- Exclusive to veterans and active-duty servicemembers—a well-deserved benefit for those who serve.
Rural Development Home Loan a.k.a USDA Home Loan
- No down payment is required.
- Designed for eligible rural and suburban areas.
Each program has unique benefits, which is why working with mortgage broker Logan Martini with the Martini Mortgage Group is essential to finding the best fit for you.
Let’s Talk About PMI
Private mortgage insurance (PMI) often gets a bad rap. Many buyers delay purchasing to avoid PMI altogether. But here’s the thing—PMI is a tool, not a barrier.
It allows you to buy with less money upfront, and once you reach 20% equity in your home, you can typically cancel PMI. In most cases, the cost of PMI is far less than the financial impact of waiting.
Why Acting Now Beats Waiting
Time in the market beats timing the market every time. Waiting for that perfect moment or that elusive 20% down payment could cost you thousands in higher home prices or mortgage rates.
Buying a home now lets you:
- Lock in today’s prices and rates.
- Start building equity sooner.
- Take advantage of programs designed to help you buy with less upfront.
Ready to Take the Next Step?
The dream of homeownership is closer than you think, and you don’t have to go it alone. At Martini Mortgage Group, we’re here to help you create a personalized plan that aligns with your financial goals and lifestyle.
Let’s make your homeownership dream a reality. Schedule a complimentary, no-judgment consultation with Kevin Martini or Logan Martini today by calling 919.238.4934.
The Martini Mortgage Group Bottom Line
Don’t let outdated advice hold you back. You don’t need 20% down to buy a home. The sooner you act, the sooner you can start building your future.
Remember: The dream of homeownership isn’t a distant goal—it’s within reach. Let’s make it happen.
Logan Martini | NMLS 1591485 | Senior Mortgage Strategist | Martini Mortgage Group at Gold Star Mortgage Financial Group, Corporation | NMLS # 3446 | 507 N Blount St, Raleigh, NC 27604 | (919) 238-4934 | www.MartiniMortgageGroup.com | [email protected] | Equal Housing Lender
Kevin Martini | NMLS 143962 | Certified Mortgage Advisor | Martini Mortgage Group at Gold Star Mortgage Financial Group, Corporation | NMLS # 3446 | 507 N Blount St, Raleigh, NC 27604 | (919) 238-4934 | www.MartiniMortgageGroup.com | [email protected] | Equal Housing Lender
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