Category: Home Mortgage - Enbright Credit Union

Planning a Down Payment for Your Home

Ever scroll through online home listings until your eyes are blurry, wondering, “How much house can I afford?” Homebuying can be a formidable process, especially for new buyers. But it doesn’t have to be. Grab your blue light glasses, and let’s dig into what it takes to plan a down payment for your home.

Answering the question of how to save for a house starts with figuring out how much you’ll need to save for the down payment, which is the amount of money you pay upfront toward purchasing your home. The down payment typically ranges from 3% to 20% of the purchase price.

Read on to learn what goes into saving for a home, including how the down payment affects your monthly mortgage and how the down payment impacts how much home you can afford overall. You’ll also learn creative ways to save money for a down payment, and how your local credit union can help you with financial education and favorable home-buying programs for credit union mortgages.

Take the Guesswork Out of Your Down Payment

Not knowing how much you’ll need to put down on a home can be a major stress factor when you just want to enjoy the excitement of buying a home. Take the guesswork out of the process with online calculators, such as this one from Freddie Mac, to figure out your potential monthly payment by changing up the variables that impact expenses. Such variables include:

  • Annual income. How much money you make in a year will impact your ability to produce the upfront cash needed for a down payment.
    Monthly debts. Other monthly payments, such as home utilities, school fees, and other miscellaneous expenses, will impact how much you can afford to pay toward your mortgage each month.
  • Term length. The longer the term of your mortgage loan (30 years is most common), the more payments you will need to make over time and the more interest you will pay.
  • Interest rates. Interest rates vary depending on various factors — including the down payment amount. Typically, the more money you put down, the better interest rate you can receive from your mortgage lender.
  • Down payment amount. The down payment amount will affect your monthly payment. A larger down payment translates into less money owed on the mortgage.

How Mortgage Type Impacts Down Payment

How much down payment money you need to accumulate as you save for a home may depend on what type of mortgage you choose. Here are common types of home mortgages and their typical minimum down payment percentages:

  • Conventional vs. jumbo mortgages. Conventional mortgage loans come from banks, credit unions, or alternative lenders and typically require a down payment of at least 3%. For more expensive properties, Jumbo mortgages require a more significant down payment, commonly at least 10% or as much as 30% of the home’s value.
  • Government-backed mortgages. Government-backed mortgages are available through three government agencies that help home buyers secure loans and offer certain benefits. These loans can help borrowers with fair or poor credit who cannot provide a sizable down payment.
  • Federal Housing Administration (FHA) – offers a 3.5% minimum down payment
  • U.S. Department of Agriculture (USDA) – offers zero-down loans
  • U.S. Department of Veterans Affairs (VA) – offers zero-down loans

For the majority of home buyers who deposit less than 20% of a home’s value as a down payment, it’s important to know about private mortgage insurance.

How Down Payment Affects Private Mortgage Insurance

Conventional wisdom on saving for a home is to accumulate enough to make at least a 20% down payment. In that case, those who plan on buying a $500,000 house would need to save $100,000 for a down payment.

Sure, putting down one-fifth of the cost of your home will reduce your monthly payments and help you get a better interest rate on a mortgage. However, while a 20% or higher down payment may be ideal, saving that much can be difficult. In fact, the average home buyer provides a down payment of around 6% to 7% of the home’s value.

When a homebuyer has a conventional loan and puts down less than 20% of a home’s value as a down payment, the lender will generally require private mortgage insurance (PMI). PMI protects the lender if you stop making payments on your loan. Typically, the homeowner must continue to pay PMI until the home’s equity reaches 20% of the home’s value.

However, not all lenders require PMI, even with a down payment that is less than 20% of the home’s value. Credit union mortgages, for example, are known for their flexibility in working with members to suit individual needs. So, it’s worth checking with your local credit union to see your available mortgage options.

Ways to Save for a House

There is no magic bullet to saving for a house; as with anything, saving steadily over time is your best strategy. However, if you’d like to maximize the amount when you ask yourself, “How much home can I afford?”, you can tackle saving for a home in two ways:

Monthly savings approach. Figure out how much you can save monthly and then calculate how long you’ll take to collect a down payment.
Deadline approach. Figure out when you want to have the down payment, and then calculate how much you need to save every month to meet that goal.
The first option may take longer but allow you to live more comfortably, while the second option may require cutting a lot of spending to meet an aggressive timeframe.

Creative Ways to Save for a Down Payment

Whichever method you choose in saving for a home, you can take steps to speed up the process:

Decrease unnecessary spending. Cut back on things like entertainment, subscriptions, and eating out.
Go on a spending diet. Pick a specific period of time (we recommend at least a month) where you commit to intentionally spending only on essentials. Any money you would have spent on ‘extras’ can go toward your down payment.
Find secondary income streams. Whether it’s driving for a ride-sharing service in your spare time or selling your homemade mugs on a craft platform, there are myriad ways to bring in extra income with a side hustle.
Sell your stuff. Whether it’s grandma’s Christmas china that never gets used or that guitar you swore you’d learn how to play, take a look around you. It’s easy to sell unwanted items on social media or at your local thrift store.
Prioritize paying down debt. Doing so will help improve your credit score and increase your likelihood of getting a reasonable mortgage rate when it’s time to purchase.

Home-Buying Assistance Programs

Home-buyer programs from government agencies and financial institutions, like credit unions, offer various services to help fund your home purchase. Qualification for such programs varies but often depends on factors such as income level, credit score, expense, and intended use of the home. Here are some programs that may be available to you:

  • Down payment assistance. Down payment assistance is money that covers a portion or the entire down payment for a home. It can come in the form of grants that do not need to be repaid, low- or no-interest loans, and matched savings programs.
  • Closing cost assistance. Similar to down payment assistance, this form of aid covers the expenses associated with closing on a home.
  • First-time home buyer programs. While some assistance programs apply to true first-time buyers, many state, federal, and other programs consider you a first-time buyer if you have not purchased a home in the last three years or are purchasing your first home as a divorcee. These programs offer flexible mortgage financings such as zero down payment, favorable interest rates, and no PMI.

Further Resources on Home Down Payments

If you’re looking for more information on planning a down payment for your home, plenty of resources are available online. Check out these helpful and often interactive sites:

  • Consumer Financial Protection Bureau: Let’s you explore interest rates and how they might impact your payments. Offers a variety of calculators to help you approximate everything from mortgage loans to savings estimates.
    National Association of Realtors: The Downpayment Expectations Report provides a national perspective on stakeholder down payment expectations.

Enlist a Partner in Your Home-Buying Experience

Community-based credit unions often offer home-buying programs and can be an excellent resource for home-buying education and advice. Combined with leading rates on savings accounts and lower banking fees, they can be a great option for any home buyer.

Learning how to save for a house doesn’t need to be intimidating. Credit unions are here to help you understand what you need to know, find the right mortgage for you, and set you on the path to homeownership. Use our Credit Union Locator to find out about a credit union home loan near you.


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2022 Down Payment Assistance Programs for Tennessee 1st time Home Buyers

2022 Tennessee Housing Development Agency (THDA) Great Choice for First Time Home Buyers

  • First time home buyers
  • For middle / moderate-income families
  • Requires a credit score of at least 640
  • Additional downpayment assistance is available (up to 5%) for qualified Tennesseans (HHF-DPA)
  • Household income must be $95,900 or less depending on the county and household size see income limits chart
  • The home purchase price must be $375,000 or less depending on the county see purchase price limits

2022 Hardest Hit Fund Down Payment Assistance (HHF-DPA) Program for First Time Home Buyers

  • Provides a $15,000 down payment assistance regardless of the purchase price of the home
  • Assistance is a 10-year forgivable loan at 0% interest and no monthly payments
  • Must purchase an existing home (no new construction)
  • Works in conjunction with THDA Great Choice program
  • Must complete a THDA-certified Homebuyer Education class
  • See eligible zip codes below
37037 37040 37042 37073 37086 37110 37115 37148 37172 37186 37207 37208 37217 37218 37303 37311 37321 37323 37404 37406 37411 37412 37416 37660 37716 37721 37813 37821 37871 37912 37914 37917 37921 37924 38012 38016 38018 38053 38063 38105 38107 38109 38111 38115 38116 38122 38125 38127 38128 38133 38134 38135 38141 38301 38305

2022 – The Housing Fund Down Payment Assistance for Current or First Time Home Buyers

  • Up to $35,000 loan for a down payment
  • 5 to 8 percent interest rate based on income tier and loan type
  • 10 to 15-year term based on loan amount
  • The home must be the buyer’s primary residence
  • The first mortgage lender must be FHA approved in Tennessee
  • Homebuyer Education, provided by a THDA-certified counselor, must be completed prior to closing (online class available)
  • Borrowers must contribute at least 1% of the sales price to the purchase
  • No bankruptcy in past 3 years
  • Household income must be $90,450 or less depending on county and houshold size… see income limits chart below
County AMI 1 person 2 people 3 people 4 people 5 people 6 people 7 people 8 people
Nashville-Davidson Tier 1 80% $38,400 $43,850 $49,350 $54,800 $59,200 $63,600 $68,000 $72,350
Nashville-Davidson Tier 2 100% $48,000 $54,850 $61,700 $68,500 $74,000 $79,500 $85,000 $90,450
Clarksville-Montgomery Tier 1 80% $30,200 $34,500 $38,800 $43,100 $46,550 $50,000 $53,450 $56,900
Clarksville-Montgomery Tier 2 100% $37,750 $43,150 $48,500 $53,900 $58,200 $62,500 $66,850 $71,150
Maury Tier 1 80% $31,500 $36,000 $40,500 $44,950 $48,550 $52,150 $55,750 $59,350
Maury Tier 2 100% $39,400 $45,000 $50,650 $56,200 $60,700 $65,200 $69,700 $74,200
All Other Tennessee Counties contact us

2022 USDA 100% Financing Program for First Time Home Buyers

  • For first time home buyers
  • No down payment required
  • Requires a credit score of at least 640
  • Property must be located in targeted area.
  • Maximum household income varies from $54,600 to $89,600 depending on county and houshold size
  • Maximum home purchase price varies from $240,000 to $275,000 based on county
  • PMI (Private Mortgage Insurance) not required
  • Seller can contribute up to 6% of purchase price toward closing costs

2022 America’s Home Buyer Solution for Current or First Time Home Buyers

  • For first time home buyers AND current homeowners
  • Get up to a 2.5% Down Payment Grant toward the purchase of a home (never needs to be paid back)
  • The remaining 1% down payment required can be a gift from a family member.
  • Applies to any FHA Approved Property (including duplexes, triplexes, and 4-plexes) in Tennessee
  • The seller can contribute toward pre-paid expenses and closing costs such as taxes, insurance, etc.
  • Income limits apply based on county.
  • The home must be owner-occupied. No rental properties.
  • No pre-payment penalties.
  • Requires a credit score of at least 640
  • Household income must be at or below The USDA median income limits.
  • Must complete a THDA-certified Homebuyer Education class (cost approx $60)

2022 FHA Program for First Time Home Buyers

  • For first time home buyers
  • Low down payment
  • Requires a credit score of at least 620
  • Parents or family members can co-sign a loan (kiddie condo)
  • Lower down payment than the standard FHA program is available in Tennessee if you purchase FHA Foreclosure
  • Down payment can be 100% gift, 100% down payment assistance, or 100% grant funds
  • Single-family, condo, and 2-4 unit property loan limits for FHA approved condos Find Eligible Condos
  • The seller can contribute up to 6% of the purchase price toward closing costs
More down payment assistance programs for Tennesseans may be available soon. Please visit again for updates.
The information presented on this site is deemed to be accurate at the time of writing.
We make every effort to keep our information current; however, please be advised, some programs may alter their terms/conditions or max out their funding.

Featured Tennessee Cities:
Athens, Bartlett, Brentwood, Bristol, Chattanooga, Clarksville, Cleveland, Collierville, Columbia, Cookeville, Dickson, Dyersburg, East Ridge, Elizabethton, Farragut, Franklin, Gallatin, Germantown, Goodlettsville, Greeneville, Hendersonville, Jackson, Johnson City, Kingsport, Knoxville, Lakeland, La Vergne, Lebanon, Maryville, McMinnville, Memphis, Middle Valley, Morristown, Mount Juliet, Murfreesboro, Nashville, Oak Ridge, Sevierville, Smyrna, Soddy-Daisy, Springfield, Spring Hill, Shelbyville, Tullahoma

Featured Tennesee Counties
Anderson, Bedford, Benton, Bledsoe, Blount, Bradley, Campbell, Cannon, Carroll, Carter, Cheatham, Chester, Claiborne, Clay, Cocke, Coffee, Crockett, Cumberland, Davidson, Decatur, DeKalb, Dickson, Dyer, Fayette, Fentress, Franklin, Gibson, Giles, Grainger, Greene, Grundy, Hamblen, Hamilton, Hancock, Hardeman, Hardin, Hawkins, Haywood, Henderson, Henry, Hickman, Houston, Humphreys, Jackson, Jefferson, Johnson, Knox, Lake, Lauderdale, Lawrence, Lewis, Lincoln, Loudon, Macon, Madison, Marion, Marshall, Maury, McMinn, McNairy, Meigs, Monroe, Montgomery, Moore, Morgan, Obion, Overton, Perry, Pickett, Polk, Putnam, Rhea, Roane, Robertson, Rutherford, Scott, Sequatchie, Sevier, Shelby, Smith, Stewart, Sullivan, Sumner, Tipton, Trousdale, Unicoi, Union, Van Buren, Warren, Washington, Wayne, Weakley, White, Williamson, Wilson


2022 Down Payment assistance programs for Tennessee first time home buyers. (n.d.). Retrieved March 9, 2022, from

Meet Beverly Fuqua, Enbright’s Mortgage Lending Officer

Allow me to introduce myself!

My name is Beverly Fuqua and I am a Mortgage Lending Officer in your area. I’d like to get together with you to discuss your options for purchasing or refinancing; together, I know that we can achieve a fantastic new loan that will save you money—now, and in the future!

The surge of the housing market in Nashville and surrounding areas is continuing to grow and does not look as though it will change anytime soon. That is more reason to contact me to get your pre-approval letter to have when you find that New Home.

The purchase of a new home is so much more than the accumulation of property—it is an investment in your future. You’re a hard-working individual, and you deserve to get the most out of your money—and that’s exactly what financing a new home can do for you!

Financing a home doesn’t have to be a complicated procedure if you have the right professional to guide you through the process. You have my personal guarantee that you will receive unparalleled guidance and advice throughout the entire process. I work with the best team around to also help with this process.

There are probably a lot of reasons that you have or will invest in a home: security, stability, the benefits of accruing equity—and, of course, the pride of ownership.

As your Mortgage Lending Professional, I will ensure that you are fully informed as to your best possible options, and I will advise you accordingly. You can trust that I will make every effort to make your financing process a success.

Let’s talk more about this in person; give me a call at 615-687-4801 ext. 2037 or email me at [email protected] , so that we can discuss your options. After all, it’s time for you to start investing in your future! Rates are low!!

Contact Beverly

Beverly Fuqua

Enbright Credit Union Mortgage Loan Officer

NMLS# 2135615

Enbright Credit Union

270 Indian Lake Blvd

Hendersonville, TN 37075

615-687-4801 ext 2037

[email protected]

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