Doug Van EttenYOUR JOURNEY HOMEGrand Junction Free Press Real Estate Columnist

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December 29, 2011
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Local real estate Q&A: Where do I get a downpayment?

Q: There is a home I am interested in buying; however I do not have all the money I need for a down payment. I am concerned that if I wait as long as it will take to save the additional money for the down payment, the house will be sold. What are some of my options?***A: If you are a military or National Guard veteran or active duty you may qualify for a VA, or Veterans loan which does not require a down payment. If buying in Fruita or some other parts of the Grand Valley, you may qualify for a US Department of Agriculture backed loan that does not require a down payment. Other than those two options you will, in most cases need between 3.5-5% of the purchase price as a minimum down payment. If you are having difficulty saving or need the money right now there are a few authorized ways you may be able to come up with down payment money. First, have you asked any family members - Mom & Dad, grandparents or siblings - if they can give you a 'gift'? Another way one of these family members may be able to help is by getting on the loan with you as a non-occupant co-borrower. Essentially your parents or grandparents will be the owner of the home along with you. A 401K or IRA retirement funds may be another place you can borrow funds from for part or all of your home purchase down payment. In addition to family members it is worth looking into social service agency programs that you may specifically qualify for due to your personal circumstances. If you work for a major company it could even be worth asking your employer if they have a program to loan you down payment funds.There is always the option to sell other assets; maybe you own a boat, snow machines, a second car or truck? Or, if you do have an asset like one of these with adequate equity, you may even be able to refinance that to take out enough cash to make ends meet for your home purchase down payment. Be careful, since as a result of refinancing, borrowing against your retirement funds or taking someone else's money you may incur a Federal or state tax liability. For advice in this area, I suggest you talk with a CPA or other financial advisor before taking action.These are just a few of the options you may have at your disposal to get the money together for your down payment. Weigh these resources; seek professional financial advice and I wish you the best of success in your effort to purchase that house.---------------------------Doug Van Etten is an associate broker at Keller Williams Colorado West Realty. He has been helping families buy and sell their homes since the early 1990s.


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The Post Independent Updated Dec 29, 2011 07:18PM Published Dec 29, 2011 07:14PM Copyright 2011 The Post Independent. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.