It is the American dream for many people, especially newlyweds who are just starting their life together. What is this dream I’m talking about? Buying your first home, of course. However, even if you have top-notch credit, you still need to consider a down payment and closing costs, both of which can break your bank depending on the cost of the home you choose. Fear not, help is out there. You may be able to buy your first home with no down payment. Yes, that is correct. Not a penny. How cool would that be?
Mortgage without down payment
A no down payment mortgage is pretty self explanatory, but how common are they? Not much, but it can be done. You see, today’s economy has drastically changed things in the world of real estate. For example, 20 years ago people were expected to put a 20 percent down payment on a house. Today, the average down payment is just 3 percent. It’s no secret that houses don’t sell quickly; this can increase your chances of buying your first home with no down payment if your credit is poor.
The first step
Before you bring up the subject of not paying a down payment, get pre-approved for a home. This will tell you which houses are in your price range before you start looking.
Loans Quicken Loans VA
Once you find a house you like, it’s time to talk business. One of the most popular programs to help first-time buyers buy a home with no money down is Quicken Loans VA Loans. This is for veterans who want to buy a home and rarely need a down payment. The problem is that most military veterans don’t know this, so feel free to share this information.
Down Payment Gift Programs
A down payment donation program, better known as down payment assistance programs, is available to those who have shown that they will not have a problem making their monthly payments, but are unable to make the initial down payment. Each state has these programs available to first-time homebuyers, but their eligibility requirements vary. Some may set limits on how much a family can earn each year to qualify, or put a cap on the cost of the home you’re buying.
You can usually apply for down payment assistance on a new or existing home, but the money you receive cannot be used to refinance a home. These programs are usually available through your state’s housing programs, which are located in each county. Another option is your lender. They can help you choose the right assistance program for you and help you write your offer to purchase, along with your application for assistance.
NACA – Neighborhood Assistance Corporation of America
There is a loan program that offers 30-year mortgages with no down payment and no closing cost. Plus, this is one of the lowest fixed rate loans in the United States. The NACA (Neighborhood Assistance Corporation of America) loan process is based on your income and not your credit score. Participants must attend a NACA Seminar, Homebuyer Workshop, and become NACA Qualified.
NACA offers rehabilitation funds to fix up your home and they will be included in your loan. You can also buy up to four-unit residential properties as long as you live in the property. NACA buyers can purchase homes that would not qualify for FHA or traditional mortgages. You can also pay your interest rate.
The NACA process is brutal. Some buyers wait 1-2 years to qualify to purchase and longer to find a property. Escrow can take months due to inexperienced agents who are not trained in NACA procedures. But once you’ve purchased, you can have the lowest 30-year fixed-rate loan in the country.
Buying your first home can be a daunting process, especially when you have an important piece of the puzzle to worry about, like a down payment. Take advantage of those around you who want to help you move into your home and trust down payment assistance programs to get those keys in your hands.
