Low Down-Payment Options To Purchase A Home

There is a common myth and misconception you have to save a 20% down payment to purchase a home. The truth is there are many different low down-payment options available to a potential homeowner. Are you looking to purchase a home? These are the most common low down-payment loans available to purchase a home.

FHA Loan

FHA Loan: The Federal Housing Administration loan is available to owner-occupant home buyers for as little as 3.5% down. This loan type is particularly powerful because you can have a 203k home repair loan. The 203k loan allows for up to $30,000 in repairs to be wrapped into the loan. You can purchase a fixer-upper home in at a low price, then get it repaired. This builds Instant equity with a very low down-payment! To learn more about the FHA loan go here.

Chenoa Fund Loan

Chenoa Fund Loan: The Chenoa Fund Loan is the FHA Loan combined with a 3.5% down payment is provided by a second mortgage. Using this loan you can purchase a home for 0% down. This low down-payment option is for underserved markets. To learn more about the Chenoa Fund Loan go here.

USDA Loan

The United States Department of Agriculture loan is available to homeowners that want to purchase a home in a rural area. It is a very low down-payment option, allowing 0% down. The closing costs can even be gifted to you. Some lenders even have a program where they will do the gifting if you agree to live in the home for a set period of time.  There are some income eligibility requirements which can be found here.

VA Loan

Are you a Veteran? An active duty service member who has served more than 90 days? A reserve/national guard service member who has served more than 6 years? Or a surviving spouse? You may be eligible for the VA loan. The VA loan is another 0% down option. You will be required to pay a funding fee which can be between 1.25-3.3% of the loan. Unless you have at least 10% VA disability (then the fee is waived). The service member can request the seller credit them up to 4% of the loan in seller credits. Doing this the buyer to purchase a home with literally no money down. To learn more about the VA Loan go here

HomeReady Mortgage

Fannie Mae created this mortgage for first-time home buyers. You will need to take an educational course which will help you understand the home buying and ownership process. Buyers can then purchase a home with 3% down. For more information on this loan go here.

Another benefit for many of these loans is purchasing a multi-family property. Most of them allow you to purchase a 2-4 unit property as long as you live in one of the units. This means you can live in one unit while the someone else pays all or most of your mortgage payment. If you are interested in learning more about any of these loans I highly suggest reaching out to a local lender to learn more. If you are interested in learning more about these low down-payment options contact us.

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