Cash is in demand

With the tightening economy and credit crunch, you should expect to put some money down —- in some cases, a hefty amount —- when buying a home.

The median down payment paid out by people buying a home through the middle of 2008 was 9 percent of the purchase price, according to the National Association of Realtors’ 2008 Profile of Home Buyers and Sellers. And fewer people found loans requiring no down payment. In fact, the number of first-time buyers purchasing a home with no money down dropped from 45 percent in 2007 to 34 percent, according to the Realtors association.

There are a number of ways to come up with a down payment, said Kim Jones, a home mortgage consultant with Wells Fargo Home Mortgage. Savings, proceeds from the sale of a home and gifts from friends or relatives are the three most common sources.

Another creative route, Jones details, includes using “sweat equity,” where the seller allows the buyer to make repairs in the home before closing that can be applied to the down payment, if using a Federal Housing Administration loan.

And if gifts are the source and you’re getting married, Jones suggests creating a bridal registry account for people to deposit money toward your home purchase.

We talked with three local buyers who recently bought homes to learn how they managed to come up with the necessary money to put down.

A dream come true

The buyers: Melinda Winstead, 34, a nurse in a chiropractor’s office, and her husband, Jodie, who works for FedEx Freight. They have a 14-year-old daughter, Alexandria.

Where: Vineyard Gate, Braselton. The Richport Properties community has homes listed from the $120,000s to $160,000s.

Their home: A new 3-bedroom, 2-bath home. She loves the size of the rooms. “Our master bathroom is huge,” she said. “I’ve never had a tub that I can lie down in. I still giggle that I can lie down in it.”

Purchased: April

Put down: 10 percent on the $130,000 home

Coming up with the Benjamins: They lived in the basement of a family member’s home in Suwanee for 2 1/2 years while trying to come up with the down payment.

“We just saved money like mad people for two years,” she said.

When the couple got married out of high school 15 years ago, they moved into a trailer park in Lawrenceville because it was all they could afford, she said.

They planned to fix it up and sell it in five years, but that turned into 12 years. When the trailer park was purchased a couple of years ago, she said the new owner didn’t want mobile homes built before 1980. Theirs dated to 1978, so they had 60 days to move off the property.

“We couldn’t find anybody to take it because it was so old,” she said. “We ended up donating it to a family who lost their home in a fire, which then left us homeless.”

Vineyard Gate caught their eye because homes were in the low $100,000s.

“In this day and time, I don’t know how anybody can afford a house more than that,” she said. “I work full time, my husband works full time, and it takes both of us just to survive.”

Happy ending: “To have that American dream that everybody talks about, it’s the most satisfying, the most exhilarating feeling that you can imagine,” she said. “The day we signed the house, it was the day before my 34th birthday. When they handed us the keys, it was like we were in a dream. It’s like we were in a movie and I was playing someone else’s part.”

Early Christmas present

The buyers: Corbyn Bridgman and her husband, Aaron. The 26-year-olds work for Atlanta condo management companies.

Where: Hawthorn Glenn, Grayson. The community has homes listed from the mid-$100,000s to the low $200,000s.

Their home: A 4-bedroom, 2 1/2-bath home built in 2005 with a basement. “Because of our price range, we were looking mainly at foreclosed homes,” she said. “We really lucked out because this one was definitely a gem of a foreclosure.”

Purchased: End of October

Down payment: Three percent, about $5,000. About 20 percent came from their savings; the rest came from outside help.

Coming up with the Benjamins: The couple —- they have an 18-month-old daughter, Vivian —- had rented for three years. About four months into their search, they spotted a home in Hawthorne Glen. They got it for about $16,000 off the asking price.

They were banking on help from a down payment assistance program but missed the deadline, so they needed to find another source of funds. They asked Corbyn’s mom, Denny Wood, and Aaron’s mom, Aleisa Hodgens, and his stepfather, Damon, to contribute. “It was going to be a Christmas gift, but we had to take it earlier than expected,” she said.

Family support: The couple approached their parents separately and found both were supportive. “The worst part was knowing that coming into this Christmastime, and obviously everybody’s going through a financial bind, and then to have to ask for such a large amount right before Christmas,” she said. “It definitely made me realize that we’ll probably have to do this in the future for our children.”

Severance payment equals new home

The buyers: Catherine Tripplehorn, 41, who works for Travel Guard, and her husband, Brian, 37, an airline consultant. They have two children, 3-year-old Parker and Elizabeth Ann, who turns 2 in February.

Where: Haley Farm, Canton. The community has new homes listed from the high $300,000s to the high $400,000s.

Their home: A new four-sided brick home that’s double the size of their previous home in Smyrna, with 7 bedrooms, 7 1/2 baths, a finished basement and features such as three fireplaces.

Purchased: August

Put down: 10 percent on the $505,000 home

Coming up with the Benjamins: They couldn’t count on the sale of their home in Smyrna, which had been on the market since February and reduced three times. The builder of the home they wanted in Haley Farm agreed to buy it, but they took a loss on it. But they didn’t have to pay commission to a buyer’s agent, which she estimates saved them $12,000-$15,000.

“What we were able to buy up here really made a difference,” she said. “We felt like we got such a good deal on this house.” They used her husband’s severance package, cashing in a pension account and selling stock. If he hadn’t gotten a new job around the same time as being offered the voluntary package, they wouldn’t have been able to buy the house, she said. The other half of the down payment came from savings.

No-brainer: The decision to use the severance was a no-brainer because it would have gone to redoing the kitchen and putting new carpet in their previous house if they didn’t buy a new one.