Buying a House with No Down Payment

Home values have risen substantially over the past several years and are expected to continue that trend, at least short term.  That means that for many individuals and family, the largest hurdle to home ownership is coming up with a down payment.  Conventional loans typically come with a 3% down payment requirement, and FHA loans require 3.5% down – these percentages can add up to some pretty hefty dollar signs in higher priced markets, so often that 3%-3.5% is the difference between renting and home ownership.

Everyone has heard that “when you rent, you pay your landlords mortgage”, and phrases similar to “home ownership is the key to building wealth”.  We believe this is true, but how can someone struggling to be a home owner come up with that down payment in markets that are very expensive?  Well, buying a house with no down payment is not only possible, but with the right lender, it can be easy!

A down payment should’t block your home ownership dreams

The answer for some people lies in specialized programs that don’t have down payment requirements.  VA loans for eligible veterans is a program that allows up to 100% financing.  That means no down payment required.  Even better, it allows a seller to contribute up to 4% of a home price to the veteran to help pay closing costs, so theoretically, under the VA program, a veteran could buy a home with $0 out of pocket.  USDA is another program available with $0 down payment requirement.  USDA is a program available to low and moderate-income buyers in designated rural areas (many are closer to cities than you might think!), and like VA loans, allows for 100% financing.  VA and USDA loans are two options to consider when buying a house with no down payment.

If you’re not eligible for either of those programs, you’re still in luck!  There are many down payment assistance programs available that will help provide the funds needed to cover down payment requirements.  HUD has approved many programs – both local and national – that will provide money to qualifying borrowers for down payment and sometimes even closing costs for home purchases using FHA financing.

MasonMac offers down payment assistance (DPA) programs in every state in which we’re licensed, and we have many different types of DPA – from local bond money to national DPA programs, we ensure down payment funds don’t prevent you or your family from enjoying the financial and other perks of home ownership.  Bottom line is a down payment shouldn’t stop you – buying a house with no down payment is an option you likely have!

Questions about DPA and how it can help you achieve your home ownership dreams?  Reach us at home@masonmac.com with any questions you have or anything we can help you with, or ask an expert here.