Hi there! If you’re interested in buying a home but can’t afford the down payment, no need to fret. There are a number of no down payment mortgage programs that you might be able to qualify for. In fact, the following 6 programs are very much worth further investigation.
- USDA Loans
- VA Loans
- FHA Loans
- Navy Federal Credit Union 100% Financing
- FHA 203k Loans
- Conventional 97% LTV Mortgage
What if I’m a first-time homebuyer?
First-time homebuyers often don’t have capital sufficient enough for a down payment. This is why FHA loans are very popular. Borrowers can put zero down on their mortgage if someone willing to front the money. Another option is to look for a grant or down-payment assistance program. Government programs and grants can be found on the HUD website. These programs can also be found on your local city, or county website. While FHA loans are not a zero down mortgage program, they will allow 100% of the down payment to be designated as a gift.
What if I have bad credit?
When a mortgage lender finances 100% of a home they’re, in turn, taking on more risk. Because of this, lenders often have more strict guidelines regarding these mortgage variants. In spite of this, however, VA loans have the lowest default rate of any mortgage program. This is mainly because the VA works directly with lenders to negotiate new terms when a Veteran is facing financial hardships. FHA loans are the main option for home buyers with bad credit. If you have a 500-579 credit score, you can generally qualify with 10% down. If your score is 580 or above you can qualify with just 3.5% down. While you need 3.5% down for FHA, they do allow 100% of the down payment to be a gift. Moreover, you can find down payment assistance programs that allow you to buy a home with no money down.