Down Payment for New Construction in Las Cruces

Down payment options at Las Cruces builders

All six active Las Cruces builders accept VA, FHA, USDA, and conventional financing. The down payment options break out roughly:

• VA loans: 0% down for active duty service members, veterans, and eligible spouses. No PMI. Funding fee can be financed.
• USDA loans: 0% down in eligible Doña Ana County areas (typically the fringe and outlying small towns, plus parts of Metro Verde phases at the north end).
• FHA loans: 3.5% down with credit 580+. Most common first-time buyer path. Monthly MIP for the life of the loan.
• Conventional loans: 3% to 5% down with credit 620+. Lower mortgage insurance than FHA, removable at 20% equity.

The right loan type depends on credit, income, target builder, and military status. Manny Patino routes new construction buyers to lenders by loan type.

How builder closing concessions change the down payment math

Las Cruces builders typically offer closing cost concessions of 2 to 5% of contract price, especially on spec inventory at quarter end. On a $325,000 contract that's $6,500 to $16,250 of seller-paid closing costs.

Layered on top of the loan-type minimum down payment, builder closing concessions can drop the net cash-to-close dramatically:

• VA with 3% builder concession: 0% down + $9,750 builder concession = net cash to close around $1,500 (just the VA funding fee adjustment and a few prepaids).
• FHA with 3% builder concession: $11,375 down + $9,750 builder concession = net cash to close around $4,000.
• Conventional 5% with 3% builder concession: $16,250 down + $9,750 builder concession = net cash to close around $9,000.

Manny Patino negotiates builder concessions on every buyer-side deal.

NM MFA stacking for first time buyers

New Mexico Mortgage Finance Authority (MFA) programs can layer on top of FHA, VA, or conventional financing to lower cash-to-close further. The two main programs:

• NM MFA FirstHome: a first mortgage with a below-market rate for eligible first-time buyers.
• NM MFA FirstDown: down payment assistance loan or grant layered on top.

Income and credit thresholds apply. Manny Patino routes first-time buyers to MFA-approved lenders that know the new construction process.

Frequently asked questions