Pull together your down payment

Hands framing house made of money

Most home buyers need a down payment of 3.5% to 20% of the purchase price to qualify for a mortgage.

A few can still get away with putting no money down through one type of government-guaranteed loan.

A few may have to come up with more than 20% to buy very expensive homes or condos in overbuilt markets burdened with foreclosures such as Miami.

But most buyers will fall somewhere in between the extremes, which is good.

A down payment ensures you have some equity in your home -- that's the difference between what your home is worth and how much you owe on the mortgage.

Far too many borrowers who bought their homes with no money down during the real estate bubble are now underwater, owing more on their mortgages than their homes are worth.

They can't sell. They can't refinance. And they're defaulting by the hundreds of thousands.

Although lenders are fussier today, the clock hasn't turned back 20 or 30 years to when lenders demanded 20% upfront from everyone.

Here's what you have to do to get a loan with:

No down payment.

There's only one way to get 100% financing for a home today: qualify for a loan guaranteed by the Department of Veterans Affairs.

Veterans, including members of the National Guard and reserve units, soldiers on active duty and widows whose spouses' deaths were war-related, are all eligible for these government-guaranteed mortgages.

Although VA loans don't require mortgage insurance, they do impose a one-time funding fee that can be rolled into the loan.

If you're considered regular military, purchasing your first home and putting no money down, you'll pay 2.15% of the loan amount. The fee is 2.4% for Reserves and the National Guard. If you're purchasing your second home and putting no money down, you'll pay 3.3% of the loan amount for regular military, Reserves or National Guard.

The funding fee is usually waived for widows and vets with service-related disabilities.

The size of VA loans is also capped in high-cost areas. Check with Veterans Affairs for those limits.

A 3.5% down payment.

You can spend this little up front by getting the Federal Housing Administration to guarantee your loan, though changes made to the program in April 2010 have made an FHA loan more expensive and harder to get.

Borrowers also need at least a 580 FICO credit score to qualify.

FHA loans do require mortgage insurance covered by an up-front premium that can also be added to the principal.

This insurance is used to cover any losses lenders might incur if you default and costs 2.25% of the borrowed amount. While that can be added to your loan amount, it's still an extra charge.

If you pay less than 5% upfront, you'll also be charged an annual premium of 0.55% of the outstanding balance divided into 12 monthly payments.

Click here to learn more about FHA loans.

A 5% to 20% down payment.

Borrowers with a FICO credit score under 580 will need to put down at least 10% to qualify for a FHA loan.

Most lenders require minimum down payments of 5% for conventional loans not guaranteed by VA or FHA.

To qualify for that, you'll need to be purchasing a single-family home in a neighborhood where property values are more stable than average, and every aspect of your finances will need to be above average.

If you're buying in a market where home values are still suffering significant declines, lenders will require at least a 10% down.

Expect to be asked for anywhere from 10% to 15% down if your:

You'll also have to qualify and pay for private mortgage insurance.

Some borrowers who win approval from their bank or finance company are being rejected for PMI because insurers are actually demanding higher credit scores and lower debt-to-income ratios than lenders.

Click here to learn more about private mortgage insurance.

20% -- or more -- down.

If your credit score is below 700, most lenders will finance no more than 80% of the loan.

Same for anyone buying a condo regardless of their credit score: expect to put down 20% to 25% -- at least. We've heard of lenders demanding upfront payments of up to 50% in distressed markets such as Miami.

Jumbo loans are those that are too big to be bought by the two government-owned companies that provide more than 70% of the money for home loans in this country.

Fannie Mae (the Federal National Mortgage Association) and Freddie Mac (the Federal Home Loan Mortgage Corp.) are prohibited from buying loans larger than $417,000 in most parts of the country.

(That cap rises to $729,750 in high-cost areas like New York and San Francisco and up to $938,250 in Alaska, Hawaii, Guam and the U.S. Virgin Islands.)

Banks must use their own money to make loans bigger than that and they want more money down to do so.

Self-employed borrowers are being asked for more money down, too.

"If an employed person rates a 10% down payment, a self-employed individual may be looking at 15%," says Gene Fairbrother, lead small business consultant for the National Association for the Self-Employed.

Some help exists for low-to-moderate-income homeowners.

Congress ended the private assistance programs you may have heard about, because too many borrowers who took advantage of them were defaulting on their loans.

But state-sponsored mortgage programs are still an option for those who can meet the strict limits on how much applicants can earn and spend on a home.

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