How Much Down Payment for a Colorado Home?
If you are looking to buy a home, one of your first steps should be to know how much of a down payment you will need for the home. Here is an overview of some programs:
Low down payments - 3.5% with a 580 credit score or higher; 10% down from 500
Easier credit qualifying
3.5% down payment on 2 - 4 units. See if a Colorado FHA home loan might be the right choice for you. Approval is subject to FHA maximum loan limits in the county, credit scores above 580, not exceeding maximum debt to income ratios, and qualifying employment.
VA Loan Programs
The Department of Veterans Affairs guarantees very attractive long-term fixed rate mortgages for eligible military members with little or no down payment options using a VA mortgage.
Low Doc or No Tax-Return Mortgage
The minimum down payment for a bank statement loan is 10 percent with 720 credit scores, 15-percent for a liquid Asset-qualifier program, and 20-percent for the cash-flow investment property loan. These loans are subject to credit scores above 620, satisfactory credit report, and 2 years of self-employment, if applicable.
NOTE: 10-percent down on a bank statement mortgage triggers a rise in the rate than a 20-percent or more down payment.
Down Payments on Jumbo Mortgages
The traditional down payment is 20-percent for a jumbo mortgage loan, but there are programs with as little as 5-percent as well if you meet the stricter conditions.
Update:As of Nov. 25, 2021. A 10 percent down payment is the minimum for a home purchase price from $805,000 to $2,000,000 in Denver, Boulder and other areas of Colorado.
Home Prices in Denver and Boulder
According to the DMAR (Denver Metro Association of Realtors) the median home price in Denver in November was $600,000 and a condo is $390,000.
In Boulder, the median home price is $1,300,000 from reports by the Daily Camera. The median home price can be skewed with more multi-million dollar homes sold combined in a market with low inventory. Adjacent cities near Boulder like Louisville, Longmont, Lafayette, and Superior have lower priced homes.
Because the median price is far above the $647,200 conforming limit, you may need to have 20-percent of the home's contract price ready for a down payment. However, there are loan products that allow just 5% down up to $1.5 million (yet rates are not as attractive). If you're a first-time home buyer who wants a low down payment, we have 3-percent, 5 percent and 10-percent down to keep more money in your pocket.
Want to Buy a Duplex or Multi-family Residence?
Below are the conforming loan limits and minimum down payments for a Duplex, Triplex, or Quadplex in Denver, Boulder, CO Springs, or Fort Collins. If the purchase price or value is above these limits, you'll need non-conforming financing.
1 Unit (Home, Condo or Townhome) - $684,250 - 3% down ($20,527)
2 Units (Duplex) - $875,950 - 3.5% down ($30,658) FHA (buying 1/2 of duplex is 1 unit)
3 Units (Triplex - $1,058,850
4 Units (Quadplex) - $1,315,900
Home, Condo or Townhome - $747,500 - 3% down payment ($22,425)
2 Units (Duplex) - $946,950 - 3.5% down payment ($33,143) - FHA
3 Units (Triplex - $1,156,700 - 3.5% down payment ($40,484) - FHA
4 Units (Quadplex) - $1,437,500 - 3.5% down payment ($50,312) - FHA
Home, Condo or Townhome - $647,200 - 3% down payment ($19,416)
2 Units (Duplex) - $828,700 - 3.5% down payment ($29,004) - FHA
3 Units (Triplex - $1,001,650 - 3.5% down payment ($35,0577) - FHA
4 Units (Quadplex) - $1,244,850 - 3.5% down payment ($43,569) - FHA
Of course, if you are eligible for a VA loan, you may qualify for zero down on some of the above scenarios.
Once more, to summarize the down payment options available to help you become a homeowner in the greater Denver metro, Fort Collins and Colorado Springs area are:
FHA mortgage loans with as little as 3.5% down.
Conventional fixed-rate home loans with as little as 3% down.
VA home loans with zero down payment for eligible veterans.
Down payment assistance programs may be available through CHFA.
Seller may pay up to 3% towards buyer's closing costs
Get pre approved before looking at a home to buy
A conventional fixed rate mortgage can be assured with terms up to 30 years. With just a 3% down payment at closing for a primary residence, you may qualify for a conforming loan in Denver - Aurora - Lakewood MSA up to $684,250, Boulder County up to $747,500, Eagle up to $862,500, Garfield County to $856,750, and Summit County up to $822,375. It is not an issue if the loan is over these amounts, it will fall under jumbo financing which offers five and ten percent down programs to qualified borrowers.
Eligible Properties: residential single family homes, condos, and townhomes. 2-4-family properties require higher down payments. This programs above do not include homes with 20 acres or more, log cabins, hobby-farms, or agriculturally zoned properties.