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How To Buy A House With No Money Down Upfront: Zero Down Payment Home Loans

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Making a down payment is often one of the biggest barriers to homeownership. Even if the monthly mortgage payments on your dream home are manageable, saving thousands for a down payment takes time. Maybe you already have money saved, but don’t want to deplete your savings. Down payment assistance is a hot topic lately as interest rates continue to stay high while inventory remains low. The return of zero down payment programs could be the solution for you.

Can You Buy A House Without A Down Payment?

A down payment is your initial payment toward the purchase of your home. You may have heard that 20% of the purchase price is required at closing, but in reality, that’s not always the case. A variety of down payment assistance programs and grants are available from mortgage lenders as well as government-sponsored agencies that have made it easier and more affordable to cover certain upfront costs.

Some zero down home loan programs allow qualified borrowers to receive a second loan to cover the upfront down payment. Many independent mortgage brokers have access to affordability programs, such as United Wholesale Mortgage’s 0% Down Purchase program.* This option is available to homebuyers who meet certain income requirements.

With this program, 97% of the home’s value would be paid with a conventional loan, while a second loan would cover the additional 3%, up to $15,000. This second loan won’t accrue interest or require monthly payments, but will need to be paid in full when the house is sold or the mortgage is refinanced or paid off. That gives you time to save up while already living in your dream home.

Is It Too Good To Be True?

Understandably, given the financial crisis of 2008, certain down payment grants and affordability products have been subject to scrutiny and skepticism. However, it’s important to know that extensive regulations to protect borrowers are now firmly in place and enforced by the government and mortgage lenders.

Zero down payment home loans are meant to help qualified homebuyers buy a house with no money down upfront based on some of the qualification requirements mentioned above, as well as needing a certain credit score. These safeguards help ensure that the financial stability needed for a mortgage is present so borrowers are reasonably able to pay back these loans, while still making homeownership more accessible with no down payment required at closing.

Affordable Home Loan Options

If you don’t qualify for a zero down program to buy a house with no money down upfront, there are alternatives you might be eligible for.

If you or your spouse have served in the U.S. Armed Forces, you could qualify for a VA loan. If you’re looking to buy in rural areas, you might be eligible for USDA loans. Both offer the possibility of putting 0% down on those home purchases, while FHA loans come with a 3.5% down payment option.

If interest rates are a concern for you on your journey to homeownership, rate buydowns could also be a solution. They allow you to pay upfront, sometimes using seller concessions, to secure a lower interest rate for the first few years of your home loan term.

In today’s environment, down payment assistance and affordable home loan programs are helping thousands of homebuyers across the country get into a home. Connect with a local home loan expert at Mortgage Matchup to see if you qualify!


*Information subject to change. Certain restrictions apply. Subject to approval of borrower and investor guideline requirements. Down payment is provided as a 2nd lien against the subject property. 2nd lien bears a 0% interest rate and cannot exceed a $15,000 loan amount. 2nd lien has no minimum monthly payment requirements, a term of 360 months and is fully due as a balloon payment upon the occurrence of either a refinance of the 1st lien, payoff of the 1st lien or the final payment of the amortization schedule of the 1st lien. Borrower must qualify based on Home Possible® guidelines. Some exclusions may apply.

The principal, interest, and MI payment of a $350,000 30-year Fixed-Rate Loan at 7.125% and 97% loan-to-value (LTV) is $2,463.01. The Annual Percentage Rate (APR) is 7.657% with estimated finance charges of $8,300. The principal and interest payments, which will continue for 360 months until paid in full, do not include taxes and home insurance premium, which will result in a higher actual monthly payment. Rates current as of 06/07/24. Subject to borrower approval. Some exclusions may apply.

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