Home Buying in Mill Valley>Question Details

dgraviano, Home Buyer in Tahoe City, CA

Down payment options?

Asked by dgraviano, Tahoe City, CA Mon Feb 11, 2013

I'm a first time home buyer considering buying a single family home in the Mill Valley area but have a ways to go on saving to cover a 20% down payment. Are there any programs or options available for first time home buyers with less than 20% down?

Help the community by answering this question:


I own 3 homes. 1 is my primary residence.
the other two are rental properties that I have worked very hard to restore for the purpose of taking out an equity line of credit .
The purpose of which was helping my children purchase a first home, and using the heloc to gift them a down payment.

I'm running into questions as to whether or not the heloc is ok to sorse the down, if I co sign for them in support.
Your advise would be appreciated and options welcome. I want to make this work for my Kids.
0 votes Thank Flag Link Sun Mar 9, 2014
Good morning. Thank you for sharing your situation/concerns and ultimate outcome of helping your kids here. Are you looking to add the HELOC onto one of your investment properties or your primary residence. I find that most lenders shy away from investment property HELOCs due to the added layer of risk - may be there but they will price accordingly. In today's rising home value market, it may be easier to consider a cash out refinance on your home mortgage too.

As you can see, an assortment of options are available to consider. Please feel free to call me anytime to discuss your specific situation in further detail. Either way, good luck in helping your kids in buying a home!

Best regards.
Sean Murphy
RPM Mortgage
Flag Mon Mar 10, 2014
Many good answers below...and one additional possibility for you in some circumstances. The Seller can carry all or a part of the loan. I just closed a sale where the buyers got an FHA loan (they put 5% down) for $600,000 and the Seller carried a second loan for 10 years for $350,000. You didn't say what price range you are thinking of purchasing, but seller financing for all or part of the price could be helpful. Of course the seller must want to do that; and not all sellers will. But for some, it creates a better tax situation as well as interest income for them which may be better than what they can get on their proceeds elsewhere. so, keep it in mind. Feel free to contact me if you'd like. I've lived in Mill Valley for 30 years and have been in real estate that long as well! maryann

Maryann Pearson

415-310-1143 cell
email: maryann@maryannpearson.com
Web: http://maryannpearson.com
DRE # 00622625
0 votes Thank Flag Link Mon Feb 11, 2013
Great question and the answer is yes there are options for you to review and consider - of course the best answer for you will require more information on what type of home are you looking at purchasing (I see you noted Single Family detached). Also helpful to determine will be what purchase price you are qualified to buy at based on a review of your income and credit profile.

Specific ideas to explore further include:
1) Private mortgage insurance for loans up to $625,500 here in Marin with at least 10% down payment.
2) FHA loans which require just 3.5% down payment for loans up to $729,750. FHA will allow for 100% gift funds for the minimum down payment too but please make sure to review all the mortgage insurance options too when looking at this option to make sure its the best route for you and your situation.
3) Gift funds from close relations. Typically, you would need to bring 5% of your own funds into the purchase transaction. Papertrail of these funds from the giftor is important.

Good luck on your search. RPM Mortgage is a local lender with an office here in Mill Valley. I would be happy to speak with you to discuss your situation in more detail.

Best regards.
Sean Murphy
(w) 415-381-7052
0 votes Thank Flag Link Mon Feb 11, 2013
There are multiple options to purchase a property in Mill Valley with less than 20% down payment including: 1st + 2nd Mortgages, 1st mortgage with Mortgage Insurance (MI)/borrower or lender paid as well as governemnt insured and gauranteed programs such as FHA and VA loan programs.

Peter Barnett
Real Estate Financing

1058 Redwood Hwy., Frontage Road
Mill Valley, CA 94941
Phone: 415.381.7054
Cell: 415.845.6072
Fax: 877.833.8740
License # 01484550
NMLS # 297727

Email: pbarnett@rpm-mtg.com
Website: http://www.rpm-mtg.com/pbarnett
0 votes Thank Flag Link Mon Feb 11, 2013
Potentially. I would be happy to discuss your questions and connect you to a mortgage broker as well. I sold 7 homes in Mill Valley last year and am very familiar with the area and homes values. Please feel free to call or email anytime.

Best regards,

Caroline Nelson
Top 2% of Agents in Marin County
Pacific Union International
0 votes Thank Flag Link Mon Feb 11, 2013
It can be a challenge but as noted before there are a number of lending programs. I have 2 local Marin County lenders who do all those programs - Marin Agents like to work with local lenders fyi:
1. Direct Lender: Michael Belfour - he has great rates - American Pacific Mortgage (direct lender) 415-524-8285
2. Bank : Joe Jacobs at Chase in San Rafael - 415-499-1340
3. Mortgage Broker: Jennifer Marshal First Capital Group , 415-440-5626

if you want to talk mill valley, give me a call
Kathleen Diringer 415-793-3040

0 votes Thank Flag Link Mon Feb 11, 2013
Your first step should be to meet with a local and trusted loan officer. They can prequalify you at no cost and let you know what is available. USDA has 0 down options, FHA has a 3.5% down option so there is other choices less than 20%
0 votes Thank Flag Link Mon Feb 11, 2013
Hi dgraviano, yes there are.

FHA financing just requires a 3.5% down payment (there is also some down payment assistance options which can provide you with 3% to reduce your down payment to just .5%, but if you have the full 3.5% yourself then there are many more options). FHA financing goes up to a $729,750 loan amount in Mill Valley (Marin County).

VA financing doesn't require any down payment up to a $987,500 loan amount (Marin County), but you have to be an eligible Veteran.

Conventional financing can be done with 3% down (680 credit scores) up to a $417k loan amount, or over $417k (up to $625,500) then 10% down is needed.

USDA financing (for rural areas) is 100% financing but Mill Valley isn't in an eligible area (very, very outsquirts you may be able to find some homes).

Majority of my clients are first time homebuyers, so feel free to contact me with further questions (or ask them here) and I'll be happy to help.

Shane Milne | Lending in all 50 states | NMLS #81195
shane@thebesthomeloans | 949-273-4161 direct
0 votes Thank Flag Link Mon Feb 11, 2013
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