Buy a Home with No Money Down
It’s no secret that buying a house is a huge financial investment. In addition to the mortgage payments you’ll make monthly, there are also maintenance and repairs to consider. Then there’s the down payment—often the biggest obstacle for would-be homebuyers. The good news is that you can buy a house with no money down. Here’s how:
The Veterans Affairs Loan Program
One popular option for home buyers with no money down is the Veterans Affairs (VA) Loan Program. This program is open to eligible veterans, active-duty service members, reservists, and National Guard members—as well as their surviving spouses. If you qualify, you can apply for a VA loan through any VA-approved lender, like Banks, Credit Unions, or Mortgage Companies.
One of the most significant benefits of the VA loan program is that it allows borrowers to finance up to 100% of the purchase price without having to make a down payment. Additionally, VA loans come with competitive interest rates and don’t require private mortgage insurance (PMI). Another perk is that you can roll the funding fee (a one-time fee paid at closing) into your loan amount.
Another option for home buyers looking to finance 100% of the purchase price is through the U.S. Department of Agriculture (USDA) loan program. This program allows qualifying borrowers to apply for loans with competitive interest rates and zero down payment requirements. To qualify for a USDA loan, you must meet certain income requirements and intend to live in a rural area—but quite a few areas fall into this category, so it’s worth checking out if you think you might be eligible!
FHA loans are another option for borrowers who may not have the means to make a large down payment on their home purchase. FHA loans allow buyers to finance up to 96.5% of their home’s purchase price while still enjoying low-interest rates and flexible credit requirements. One downside of FHA loans is that they do require private mortgage insurance (PMI), which can add an extra monthly cost to your mortgage payments, depending on your loan amount and credit score. However, FHA loans also offer perks like low closing costs and flexible underwriting guidelines—so they may still be worth considering if you’re short on cash for your down payment.
There are plenty of options available for home buyers looking to finance their purchase with little or no money down—you just need to know where to look! If you’re considering purchasing a home but don’t have the savings for a traditional 20% down payment, consider exploring some alternative financing options. With these programs available, there’s no reason why you can’t become a homeowner today. Contact us to learn more about our home loans.