Can You Afford a Down Payment Now?

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I have some exciting news for you if you plan on buying a home anytime soon. Fannie Mae and Freddie Mac are now only requiring a 3% down payment to purchase a home (down from a required 5% down payment). This change is the difference between thousands and thousands of dollars, and this will allow an unprecedented number of people to begin putting down payments on homes. This should spur a significant amount of activity in our Philadelphia real estate market.

Another development is that President Obama recently announced that he is going to reduce the percentage of the Private Mortgage Insurance (PMI). When you buy a property and put a down payment of less than 20%, you're required to buy PMI. Last year that percentage for PMI was about 1.35%, and this year it is down to around 0.85%. 

There is no certainty as to when these changes will occur, but they are coming soon, so be  prepared. The biggest takeaway here is that FHA financing is going to be a great option for buyers right now. 

If you have any questions about these changes or if you'd like to speak with me about the Philadelphia real estate market, please reach out to me via phone or email.