I know it’s difficult to save that large amount of money. Even with a starter home, in this area you’ll probably need to spend at least $200,000. 20% of that is $40,000. It’s hard to save that much. But you have some options.
There are a few government backed programs. First is FHA Financing. With FHA Financing, you’ll need a minimum of 3.5% cash down. But you’ll need to pay a monthly insurance premium. This protects the lender against the possibility of you defaulting on the loan.
If you’re a veteran, you can look into VA Financing. This program allows for 100% financing without the mortgage insurance.
Another option is conventional financing with less than 20% down – for example 5% down. Again, you’ll pay mortgage insurance.
With all of these, the bank will order an appraisal which you will pay for. The bank will lend, not according to the sale price, but will lend according to the appraised price. If your purchase price is more than the appraised value, you won’t get a mortgage for the necessary amount. If this happens you will need to renegotiate the selling price, find more cash to put down or cancel the contract.
Maybe this will work for you, borrow money from your parents or a rich uncle.
OR this rather drastic approach. You have two kidneys. Do you really need both?