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Jonathan, Home Buyer in Miami, FL

How much down payment is usually required for a property under $120k? Credit score somewhere in the low 600's

Asked by Jonathan, Miami, FL Tue Oct 22, 2013

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This depends on what type of loan you choose and can afford. For example, a conventional loan requires anywhere from 10%-20% down. On the other hand, an FHA loan only requires 3.5% down but you will have to pay mortgage insurance throughout the life of the loan. Also, the minimum credit score for a conventional loan is around 620, while the minimum credit score for an FHA loan is around 580. The type of loan you get may revolve around your finances and which loan best fits you. Either way, I recommend you speak with a lender like myself. I would be glad to speak with you to help you get the loan that you need. So please feel free to contact me. Good Luck! Brian Nguyen Sr. Mortgage Banker NMLS # 659743 Phone: 949.667.2887 brian.nguyen@nafinc.com
0 votes Thank Flag Link Fri Feb 14, 2014
Assuming this is going to be your residence, as opposed to a vacation home or rental property, then with a credit score in the low 600's an FHA mortgage would probably be your best bet. Unless of course you are a US Veteran and you qualify for VA.

FHA loans require only a 3.5% down payment and it's one of the only programs that doesn't crush you on the rate for having a low credit score. Feel free to call me if you would like to get pre-approved.


Tony Grech | Mortgage Loan Originator | NMLS #977416
PMAC Lending Services, Inc.
Toll-free (855) 642-4762 ext. 278
Mobile (313) 622-7383
Fax (248) 945-4842

0 votes Thank Flag Link Tue Oct 22, 2013
This is Miami, sorry to be the bearer of bad news, but the only shot you'll have of buying a property for under $120,000 is a condo. Which also means that you're going to need a 25% down conventional loan (or a condo which passes the condo questionaire, but I believe there are none in your price range). So I would answer $29,000.

Also note that you're competing against investors at that price range, and you'll have to be pretty aggressive in order to get your offer accepted.
0 votes Thank Flag Link Tue Oct 22, 2013
It depends on the type of mortgage you get. USDA mortgages are still zero down. FHA backed mortgages require 3.5% down but also require PMI insurance, which could increase your costs rather significantly. Conventional mortgages require a larger down payment, as much as 20%, but there is no mortgage insurance. And there are special programs for public servants, union members, etc., that can keep down the fees and closing costs. You can even, sometimes, include closing costs in the mortgage. AND in some states you can even get down payment assistance.

The smartest thing you can do is meet with a good, local, mortgage banker, not a big bank but a smaller firm that specializes in writing mortgages, and see what programs are available to YOU.
0 votes Thank Flag Link Tue Oct 22, 2013
All depends what are you are buying at. The minimum required with FHA is 3.5% and usually you can get it with a 580 score or higher, if you qualify (have enough income available). There is a USDA loan that requires zero down, but is restricted to low populated areas outside of city limits.

Besides down payment you will also have closing cost. Your best route is to consult with at least 3 lenders and see what options they give you. Don't go making any big purchases (car, furniture), or opening new credit accounts for at least 90 days prior to applying for a loan. Make sure you have no late payments during the whole process. Don't go paying old debt in order to improve your scores, without the advise of your lender....there may be better ways to improve the numbers. Was this answer helpful? If so please click on "best answer" or on the "green thumbs up".

Tony Vega
Antonelli Realty
0 votes Thank Flag Link Tue Oct 22, 2013
what FHA Allows means absolutely nothing if the lender won't lend the money at those low scores

you need 10 percent down payment

0 votes Thank Flag Link Tue Oct 22, 2013
There are several options for you even at " a low 600" score.

FHA loans are not FICO score driven. The lenders really set the FICO score limits used. We have FHA lenders that will consider loans in the 500's.

With that being said you could put down as little as 3.5%.

Let me also add that depending on where you are getting your credit score number, that number you have could be quite different when a lender pulls credit. Lenders use a MCR -Mortgage Credit Report which has different scoring models than some of the credit score provider companies out there.

I would need more specifics to get you a more direct answer becasue you may qualify for other loan types with similarly low down payments.

I would love to help.

Andrew Kashella
0 votes Thank Flag Link Tue Oct 22, 2013
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