No Money Down Loans
The ability to purchase a home with little or no money down is an appealing option to buyers. Fortunately several loan programs exists which allow the purchaser to do so. The most common program is the VA loan which is limited to Veteran’s. Click here to learn more about VA lending. Another loan program available is USDA loans. The USDA loan is limited geographically and has income restrictions which will exclud particular buyers. To learn more about USDA loan click here. Both VA and USDA loans are easy to qualify for and require a credit score to be above 620-640. These loans also require the buyer to provide proof of income and assets.
Additional options exist to purchase a home with little or no money down such as a FHA loan in conjunction with local Down Payment Assistance Programs or gift for a down payment. Many local cities and counties offer down payment assistance programs which help buyers particularly with the purchase of their first home. The programs vary within cities and counties so please contact me directly for clarification as to what is available to you.
Down Payment Assistance Programs are grants provided to the buyer to pursue a home purchase. The programs normally include income restrictions and ensure buyers do not exceed a conservative budget. The programs also provide classes to home buyers to gain knowledge on the home buying process. The grants are generally called “silent second mortgages”. The grants do not require that payment be made on them and will be forgiven after a period of several years. The goal of the program is to welcome home ownership and longevity in ownership. The grants require a homeowner to live in the property for an extended period of time between 4 – 9 years. This prevents buyers from using grants to purchase a property and then selling the property for a profit.
FHA loans also allow for down payment assistance through gifts. In the past FHA would not allow the seller to fund a gift however this changed at the end of 2008. Currently FHA allows for gifts through a borrower’s relative, employer, labor union, or charitable organization. Relatives are the common source of down payment gifts. Repayment of the gift may not be expected or implied. Under certain circumstances a close family friend may also provide the down payment gift.
Lenders will verify that the donors provided the gift funds. Lenders must see the money trail to verify that all funds meet the FHA guidelines. Often, buyers will borrower the funds for the down payment. Borrowers are also allowed to take a loan against property that the borrower currently owns for the down payment as long as the loan payment is added to the loan application.
Several programs allow for the buyer to purchase a home with little or no money down. Please contact me today or apply on line to qualify for a home loan or to learn more about the programs available.
Additional options exist to purchase a home with little or no money down such as a FHA loan in conjunction with local Down Payment Assistance Programs or gift for a down payment. Many local cities and counties offer down payment assistance programs which help buyers particularly with the purchase of their first home. The programs vary within cities and counties so please contact me directly for clarification as to what is available to you.
Down Payment Assistance Programs are grants provided to the buyer to pursue a home purchase. The programs normally include income restrictions and ensure buyers do not exceed a conservative budget. The programs also provide classes to home buyers to gain knowledge on the home buying process. The grants are generally called “silent second mortgages”. The grants do not require that payment be made on them and will be forgiven after a period of several years. The goal of the program is to welcome home ownership and longevity in ownership. The grants require a homeowner to live in the property for an extended period of time between 4 – 9 years. This prevents buyers from using grants to purchase a property and then selling the property for a profit.
FHA loans also allow for down payment assistance through gifts. In the past FHA would not allow the seller to fund a gift however this changed at the end of 2008. Currently FHA allows for gifts through a borrower’s relative, employer, labor union, or charitable organization. Relatives are the common source of down payment gifts. Repayment of the gift may not be expected or implied. Under certain circumstances a close family friend may also provide the down payment gift.
Lenders will verify that the donors provided the gift funds. Lenders must see the money trail to verify that all funds meet the FHA guidelines. Often, buyers will borrower the funds for the down payment. Borrowers are also allowed to take a loan against property that the borrower currently owns for the down payment as long as the loan payment is added to the loan application.
Several programs allow for the buyer to purchase a home with little or no money down. Please contact me today or apply on line to qualify for a home loan or to learn more about the programs available.
