Low to No Down Payment Options

Low Down Payment: Fannie Mae 3% downpayment

  • The downpayment may consist entirely from “gift funds”
  • The credit score requirement is 620
  • Must be a First Time Homebuyer
  • Mortgage insurance premiums are paid  monthly

Low Down Payment: FHA 3.5% downpayment

FHA mortgage guidelines are famous for their liberal approach to credit scores and down payments. The FHA will typically insure a home loan for borrowers with low credit scores so long as there’s a reasonable explanation for the low FICO.

Other traits of an FHA loan include :

  • The downpayment may consist entirely from “gift funds”
  • The credit score requirement is 580
  • Mortgage insurance premiums are paid upfront at closing, and monthly thereafter

No down payment: USDA 100% Financing

The good news about the USDA Rural Housing Loan is that it’s not just a “rural loan” — it’s available to buyers in suburban neighborhoods, too. The USDA’s goal is to reach “low-to-moderate income homebuyers”, wherever they may be.

Many borrowers using the USDA Single Family Housing Guaranteed Loan Program make a good living and reside in neighborhoods which don’t meet the traditional definition of rural.

Some key traits of the USDA loan include :

  • You may include eligible home repairs and improvements in your loan size
  • There is maximum home purchase price
  • Guarantee fee added to loan balance at closing; mortgage insurance collected monthly

No down payment: VA loan 100% Financing

The Veterans Administration guarantees no-down purchase mortgages for qualified veterans.

  • There is no mortgage insurance.
  • The borrower pays a funding fee, which can be rolled into the loan amount.
  • The VA funding fee varies, depending on whether the veteran served in the regular military or in the Reserves or National Guard, and whether it’s the veteran’s first VA loan or a subsequent one.

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