How to Buy a House with No Money Down
If you have a good, stable job and good credit, but not much money in the bank, you may want to find home loans with no down payment so that you can become a homeowner. While getting a no down payment mortgage isn't as easy as it used to be, you can still use this guide to find out how to buy a house with no money down even in today's tough economy. Keep in mind that even a mortgage with zero down payment will require closing costs.
Home Loans for Veterans
If you are a veteran of the United States Armed Forces, it's very likely that you qualify for a no down payment mortgage through the Department of Veteran's Affairs. The VA provide home loans with no down payment as a benefit of military service. If you want to know how to buy a home with no money down through the VA, you can ask your local VA office and see if you qualify.
There are other benefits of getting your no down payment mortgage through the VA: the VA also processes its home loans with no down payment substantially faster than other lenders, so you can get into a house more easily and quickly. All in all, these mortgages are by far the best deal if you have ever served in the U.S. military.
100% Home Loans
You may want to know how to buy a house with no money down even if you're a civilian. For non-veterans, it can be substantially harder to find home loans with no down payment. You may want to ask your local lenders about 100% financing, which is the bank's term for a no down payment mortgage.
You will need flawless credit and, most likely, a house appraised for significantly more than the price you're offering. Remember, the down payment protects the bank if you default on your mortgage, so the important thing is for the bank to be certain that they will make their money back on their investment.
Some banks offer a no down payment mortgage that is actually two loans, not one. These home loans with no down payment are called 80/20 mortgages, and they are called this because you are given one loan for 80% of your home's value, and the other for 20%. These home loans were substantially more common before the collapse of the housing bubble, but some lenders are still offering them to borrowers with approved credit.
You've looked through this guide telling you how to buy a house with no money down, and you oon't think you qualify. Maybe your credit has a few (or more) dings—even if you can't find a zero down payment mortgage, you may be able to qualify for a loan from the Federal Housing Authority (FHA). These loans have only a 3.5% down payment, which is achievable for most would-be homeowners much more quickly than a 20% down payment. For more details on FHA loans, you can talk to a mortgage lender near you.