The Return of Lower Down Payments

Mortgages with low down payments are making a comeback, positioning more cash-strapped consumers to become homeowners. LendingTree.com spokeswoman Megan Greuling notes that the average down payment has decreased 9.4 percent in the last two years as of May 1. Erin Lantz, director of Zillow Mortgage Marketplace, confirms, “Borrowers with small down payments have more options now, and options that are more affordable.” Guy Cecala, publisher of Inside Mortgage Finance, adds that the trend accelerated when the FHA began hiking premiums in 2012. In many parts of the country, residential property values are up while mortgage rates remain quite low. LendingTree.com CEO Doug Lebda states, “Essentially what is happening is not so much consumers desiring to put less down, but that more lenders are more willing. We are coming back to a normalized market.” | Read More