One of the biggest hurdles of buying a home is making the down payment. Besides cutting back on daily expenses and downsizing on living arrangements to save for a year or two, there are other options to consider.
- Secure a gift from family or friends. Loan officers prefer to see a gift over a loan because personal loans are considered additional debt whereas a gift is yours without the condition of repayment.
- Sell investment assets such as stock, bonds and bank CDs.
- Take $10,000 out of your IRA without penalty to buy your first home. https://www.irs.gov/publications/p590b
Any large amounts deposited in your bank account will be verified by the lender because they want to know where the money came from, and whether you took on additional debt before they can approve a mortgage for you.