Mortgage Myths: Here’s Why You Don’t Need a Full 20 Percent Down Payment

If you’re just getting into the real estate market, you may have heard that 20% down is the ideal percentage in order to lower your monthly payments and get your mortgage application approved. However, while 20% is often suggested, many people struggle to come up with this amount of money. If you’re staving off home ownership, here are some reasons you may not need to hold off as you long as you thought.

Minimizing Your Insurance Costs

Putting down 20% of the total purchase price of your home is often suggested, but it doesn’t definitively mean that your application won’t be approved if you don’t. If you have a good credit score and are in good financial standing, putting less than 20% down means you’ll have to pay Private Mortgage Insurance (PMI); however, it can be worth paying the extra funds in order to get into the real estate market sooner and start paying into your most significant investment.

Mortgage Programs For Less Than 20%

It may seem less possible to buy a home if you only have 5 or 7% of the purchase price, but there are many programs in the United States that enable those with limited funds to apply for a mortgage. From the Federal Housing Administration (FHA) to Fannie Mae and Freddie Mac, there are many lenders that can offer you mortgage programs that will work for your situation. While higher rates come in tandem with a lower down payment, there are options out there for those who haven’t saved quite enough.

Why Put Down 20%?

Putting down 20% is not a necessity for mortgage approval or purchasing a home, but it can be a great means of saving money in the long run and reducing your interest rates. If you’re raring to get into the real estate market and don’t want to wait for the bills to stack up, that’s OK, but if you want to hold off and save up additional funds before diving in, this can mean more money and a more solid investment in the future.

The magic number is often 20% when it comes to a down payment on a home, but you don’t require this percentage of your home’s price in order to get approved for a mortgage. If you’re currently considering diving into home ownership and would like to know more about the opportunities in your area, give me a call – J.P. Cook – 602-320-4253.

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174 E Palomino Way San Tan Valley, AZ 85143

$459,900

4 Beds

2 Baths

1,921 SqFt

Status Active

MLS # 6689071

Property Type Single Family Residence

Price Type --

Beautiful single-story home in golf course Community, Johnson Ranch. Kitchen upgraded with granite Counters & backsplash. Brand new luxury vinyl through the home. Neutral wall colors, Large RV gate, 2 car garage. Backyard features a large oversized lot with a beautiful sparkling pebble tech pool. Lots of amenities in the area including Community Heated Pool and Spa, Tennis & Pickleball Courts, Walking Paths and Playgrounds plus Pitch & Putt course. ,

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26310 N 131st Drive Peoria, AZ 85383

$459,900

3 Beds

2 Baths

1,820 SqFt

Status Active

MLS # 6690392

Property Type Single Family Residence

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Welcome to Rancho Cabrillo Subdivision in North Peoria, nestled between Lake Pleasant and the White Tank Mountains where the sunset glow dances across the natural beauty of the Arizona desert landscape. With 1820 sq. ft. of interior living space, 3 BED + Office/Den, 2 Baths and a 2 CAR Garage. Open concept main living area, crisp light gray color pallet with white trim and doors. Stylish multi-color wood look plank ceramic floors that compliment any decorating style. Open concept kitchen, dark espresso cabinets, black/white granite countertops, pendant lighting, stainless steel appliances package and a walk-in pantry for all your storage needs. Open master suite with updated ceiling light/fan fixture and can lighting. Master Bath features double sinks, a large tiled shower with seating and a walk in closet. 2 additional bedrooms, a full bath plus a spacious front Office/Den, that makes a great flex space for work, family or guests. Step out back and take a deep breath, property backs up to a green space, low maintenance with a paved covered patio and seating area, green space for pets or games. Neighborhood mountain views, close proximity to 303 freeway access, 10 minutes to TSMC, shopping, dining, entertainment, health care, and less than 20 min. away from beautiful Lake Pleasant Regional Park.

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8534 E Navarro Avenue Mesa, AZ 85209

$459,900

3 Beds

2 Baths

1,729 SqFt

Status Active

MLS # 6693497

Property Type Single Family Residence

Price Type --

Beautiful 3 bedroom home plus a den in great neighborhood! You get Gilbert's great Schools but pay Mesa's low taxes! Amazing kitchen has granite countertops, double ovens, gas cook top, white painted raised panel staggered cabinets, built in micro & under cabinet lighting. Home has beautiful wood tile flooring throughout, upgraded baseboards, NEW DUAL PAINE VINYL WINDOWS 2019, high end Pella double doors with built in blinds, ceiling fans, canned lights, neutral paint, vaulted ceilings. Open & spacious floorplan! Den could easily be used as 4th bedroom. Great backyard with covered patio, 3 citrus trees (lime, lemon & grapefruit) & large grassy play area. Great location just down the street from a large park, super close to both the 202 & US 60 freeways & plenty of shopping/entertainment!

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864 S 80th Street Mesa, AZ 85208

$459,900

3 Beds

2.5 Baths

1,984 SqFt

Status Active

MLS # 6684531

Property Type Single Family Residence

Price Type --

Welcome Home! Beautiful Home in Fountain of the Sun in a Gated Active Adult Community in Mesa, Furnished, 3 Bedroom 2 1/2 Bath, Updated Kitchen w/ Soft Close White Cabinetry, Large Pantry Area, Granite Counters and Stainless Appliances, Large Open Floor Plan with Tile Flooring , Primary Bedroom w/Walk-In Closet, French Doors & Updated Bathroom w/ Walk-In Shower, 2 Guest Bedrooms w/ Updated Guest Bathroom w/ Walk-In Shower, Carpet in the Bedrooms, Large Laundry Area w/ Wash Sink and 1/2 Bath, Storage Room, Updated Dual Pane Windows, New Roof (2019), New Water Heater (2024), Beautiful Covered Back Patio Area (10' by 30'') with Fenced in Yard Great for Entertaining, Terrific Front Courtyard!

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