Many potential homebuyers don't realize they don't need a big down payment

Many potential first time home buyers overestimate the size of the down payment required to finance a purchase of a home, according to Christina Boyle, Executive of Fannie Mae. On average, consumers believe they need 11 to 15 percent in equity to buy a home, Boyle said, citing figures from a Zelman & Associates survey of renters and people who live in the homes of others. There are several programs out there that will help first time home buyers with downpayment assistance.

1. NSP Stabilization Program - This federally funded Neighborhood Stabilization Program (NSP) enables eligible applicants to realize homeownership by offering newly built or remodeled homes for purchase in established Phoenix neighborhoods, while providing monetary incentives to assist with down payment and closing costs.

2. Matthew Hensen Homeownership Program - Designed to assist eligible first time home buyers wth the purchase of an affordable home in Phoenix. This program provides a deferred payment loan of $8,500.00 to assist with down payment and buyer's closing cost. This program is administered by Community Housing Resources of Arizona.

3. Home in 5 Program - The Home in 5 Program offers 5% of the loan amount towards your down payment in Maricopa County only. Income limitations and debt ratio limitations apply. You do not need to be a First-Time Homebuyer but must meet minimum FICO score requirements and FHA guidelines. Maximum purchase price shall not to exceed $300,000.

4. Maricopa County Home Assistance Program - This program is designed to provide home loan assistance for home purchases in Maricopa County. It is administered by Maricopa County Human Services Department (MCHSD) and provides up to $14,999 in assistance to qualified homebuyers paying for down payment and reasonable closing costs. The Home buyer assistance loans are zero-percent interest, deferred-payment, forgivable after a 5-year term, and are secured with a second lien. The homebuyer must bring 1% of $1,000 minimum of borrower’s own funds.

5. 0.5% Down Payment FHA Loan Program - First time home buyers in Arizona can buy a home with 0.5% down payment. 96.5% max LTV and 99.5% max CLTV. 

There are many program out there that will help first time home buyers. Consult with your lenders for the availability of the above mentioned programs..