For the last few years, buyers have been hard-pressed to land a mortgage if they didn’t have a 20 percent down payment, unless they turned to the Federal Housing Administration’s low down-payment loans.
But a growing number of banks are now offering loans with just 5 percent down, CNNMoney reports. For example, Bank of America, Wells Fargo, and TD Bank are among the banks reportedly offering mortgages with down payments as low as 5 percent.
Banks that are offering 5-percent down payment loans, are requiring borrowers to purchase private mortgage insurance. Borrowers will have to keep PMI until they build up 20 percent equity in the home. That is typical, your comments?
Source: “Banks Offering Mortgages with Only 5% Down Payments,” CNNMoney 11/5/13