Key Community Mortgage and Other Options for Buying a Home
Many homeowners believe that they should put down 20 percent of a home's value in order to purchase. However, there are many options available when it comes to purchasing a home with little to no down payment, including options from KeyBank.
If you're a first-time homebuyer, putting down 20 percent can be challenging. Sometimes buyers assume that Private Mortgage Insurance (PMI) is required, adding to monthly costs. However, these requirements are not necessary for all mortgage products — there are options available to everyone.
Here are some options that may work for your situation.
Key Community Mortgage® Exclusively from KeyBank
The Key Community Mortgage® is an affordable mortgage product offered specifically by KeyBank to match various lending needs. Here are some of the criteria to qualify:
- Up to 95 percent financing available
- No Private Mortgage Insurance (PMI)
- Conventional financing
- No income limitations on qualifying properties*
The Federal Housing Administration (FHA) is part of HUD.gov, and they've been providing loans since 1934. With an FHA loan, you still go through a lender but the FHA insures the loan. Some of the advantages of an FHA loan include:
- Low down payments
- Low closing costs
For first-time homebuyers, your down payment can be as low as 3.5 percent.
Veterans Affairs mortgages, also called VA Loans, are for active and retired service members, and eligible surviving spouses. Keep in mind that length of service determines eligibility.
Unlike FHA loans, VA Loans do not require a down payment or PMI. VA Loans go through private lenders so you aren't applying directly to the VA. However, the VA does guarantee the loan.
Here are some of the benefits of a VA Loan:
- No down payment as long as the sales price doesn't exceed the appraised value
- No PMI requirement
- VA rules limit the amount you can be charged for closing costs
- Closing costs may be paid by the seller
- The lender can't charge you a penalty fee if you pay the loan off early
- VA may be able to provide you some assistance if you run into difficulty making payments
Which Option Is Best for You?
As you can see, there are a number of ways to purchase a home without putting down the standard 20 percent. The option that is best for you will likely require a few conversations with your lender. Be sure to speak with your financial advisor before making any final decisions.