What’s stopping you from buying your dream home? Maybe your first home? Is it the downpayment? The monthly commitment? The additional fees? Are you just plain apprehensive about making such a big purchase? Did you know about the 3% down payment option?

Many home buyers, especially first-time home buyers are nervous about buying a home because they feel they just can’t come up with that 20% down payment and they don’t want to be stuck in a home loan that requires a lot of extra monthly fees.

Until recently, just about any loan that allowed for less than 20% down payment required monthly mortgage insurance. This is the insurance that lenders take out in case the buyer defaults on the loan. With at least a 20% down payment the home will have instant equity and if the buyer defaults, there is that 20% buffer that the lender can use to resell the home quickly. Without that much of a buffer, the lender may lose money on reselling the home. So, because of this, mortgage insurance, also sometimes referred to as PMI or “Private Mortgage Insurance” gets tacked onto the monthly mortgage payment until the home can support the 80/20 loan to value ratio. This may or may not fall off automatically so it’s usually up to the homeowner to request it be removed.

Related: What about the 1% Down Loan?

BUT – There is a program that requires only a 3% down payment with no mortgage insurance. This is much more attractive to new buyers that may not have the equity built up in an existing home.  As an independent mortgage officer I can provide my clients with this conventional loan, meaning it’s not an FHA loan, but a real, honest-to-goodness, conventional loan with no monthly mortgage insurance. Many of these loans can actually offer low payments as well. FHA Loans have several restrictions so this is actually a better deal than many of those government loans. These loans can offer more flexible appraisals and faster closings. These flexible appraisals mean as a buyer, you can offer a competitive offer without the fear of being turned down on the loan when the appraisal comes in.

This not only is attractive to buyers but sellers as well. VA Loans and FHA Loans can offer longer closings and more responsibility for the seller. These conventional loans can be more attractive to a seller, especially with a quick closing time.

So, don’t be scared! Now is a great time to consider buying a home and with this 3% down conventional loan you’ll be saving money on the down payment and saving money monthly with no mortgage insurance. Call me today to find out if you qualify and how to get started.