It is reasonable to expect to pay up to five points for a mortgage loan, but any higher and you should be wary. There are always exceptions to this, so use your best judgment and compare companies.

Get Multiple Offers

Mortgage lenders can vary as much as 5% in their interest rates, so you should compare financing packages. The internet has made comparison shopping easy. You can get bids from multiple lenders and read over their offers from comfort of your home.

Read The Fine Print

Once you get an offer from a mortgage lender, make sure you read fine print. Interest rates are easy to compare, but you should also look over fees that are involved which can add up to thousands of dollars. Also, be sure to understand any fees for late or missed payments.

1. Borrow or ask for a gift from relatives. After you have financed house, you can usually go and take out a 2nd or 3rd mortgage up to full value of your house, and then you could repay relatives. Keep in mind that if you intend money to be as a loan only from relatives, you would need to disclose that to lender before you close. Lenders usually have regulations about where down payment is coming from and if you are not honest, it could be considered defrauding a lender.

2. There are down payment assistance programs like Neighborhood Gold or Nehemiah program. These programs basically aid seller in helping you with a down payment. Receiving a down payment from seller of property is illegal, but through these programs, it is legal. There are also other down payment assistance programs which are grants and do not need to be repaid or paid for by anyone. To find out about these, do a search on “down payment assistance” with your favorite search engine.

3. You could cash out a 401K or another investment and like in first example, repay yourself with a 2nd or 3rd mortgage after loan has closed.