When you decide to buy a home in the city, the first question you may have is: How much do first-time home buyers have to put down in New York? For most first-time home buyers, the answer is 20%, but it might differ for certain buyers.
The Standard 20% Down Payment
The 20% down payment is the national average and the norm for most first-time buyers in New York. It’s the standard down payment for private mortgages. So, regardless of what you are buying in the city (a condo, co-op, brownstone, etc.), if you do that with a mortgage, you may need to put about 20% down.
Non-Standard Down Payments
There are a few scenarios in which you may be able to get by with a smaller down payment or need more than 20%.
- Certain programs like the State of New York Mortgage Agency (SONYMA) allow first-time home buyers whose annual income falls below a threshold to put down as low as 3% for a condo or a single-family home (5% for co-op).
- Mortgage lenders may issue loans to first-time buyers with solid financials and during healthy economies when they want more people to take out a mortgage loan, at a 10% down payment.
- If you are buying a co-op in the city, the co-op board may have its own down payment requirement. They may require you to put down 25%, 30%, or, in rare cases, even 50%. The easiest way to get around this is to find a different co-op that requires the standard down payment, similar to the banks.
- You may choose to put down more than 20% to get more equity in your property and lower your monthly mortgage payments.
A New York City broker can help you understand the process of down payment and the different options available to you. As a first-time home buyer in the city, you may even be entitled to a down payment assistance program.
Also Read: How to Create a Budget for Your First Apartment
