Buying an Apartment in NYC with less than 20% Down

One of the most common obstacles keeping people from buying their first apartment in NYC is the 20% down payment. To put that in perspective, on a $600K condo, that represents $120,000 in hard cash, and that doesn't even include closing costs. One of the most common questions we get is whether 20% is absolutely required to buy an apartment in New York City. Let's explore what type of down payments you might need for property in the Big Apple.

Co-Ops Require 20% or More for Down Payment

Co-ops generally have much stricter rules than condos and will always require 20% or more. Finding co-ops that require 25% or 30% is not uncommon.

Read More: What Makes Co-Ops Different from Condos

Often times what attracts first-time buyers to co-ops is that their price point is often lower than condos. While that can be beneficial, the overall down payment may create a larger barrier.

For instance, if you were to choose between a condo that costs $700K that requires 20% down, that would be a total of $140K vs. a co-op that costs $600K that requires 30% down, which would total up to being $180K.

Many Condos Require at least 20% Down

Whether buying directly from a developer or a resale from a current owner, the expectation will be that a buyer puts at least 20% down. The perception is that anything less may put the transaction at risk of falling through. Additionally, some buildings may have stipulations that allow for a maximum of 80% financing. 20% down has become quite standard in NYC.

15% Down Payments are Possible in NYC

There are many sellers and developers who are willing to accept 15% down. This is an opportunity to entice first-time homebuyers to enter the market with a cash outlay that is at their disposal. 15% down payment condos are much more prevalent in Brooklyn, where many developments in up and coming neighborhoods are willing to accept less than 20% down.

You may even find some developers that are okay with accepting a 10% down payment.

Some things to consider when putting less than 20% down include having to pay private mortgage insurance (PMI) as well as potentially dealing with slightly higher interest rates.

If you're interested in learning more about buying a condo in NYC with less than 20% down contact us below to learn more.