How to Buy a House Without Money

Ways to Buy a House Without Down Payment

      Buying a home is easier than most people think. Forget about tens of thousands of dollars to become a homeowner. You no longer need a down payment of 20% to buy a house.

In fact, there are no no-down mortgages available to you right now.

If you're wondering how to buy a house without a down payment, this article is right for your journey to home ownership.

40% of potential buyers said that saving for a down payment was their biggest obstacle to owning a home. Considering the average home selling price of $360,000, the average first-time buyer will spend $25,000 on a down payment. But you could buy a house without that $25,000.

There are resources for down payment assistance that provide an actual means of home ownership. The bill currently awaiting a vote in Congress will offer a $15,000 tax credit and a $25,000 grant to first-time buyers.

If you're wondering if now's a good time to buy a house with no down payment, you don't have to wait for new federal laws. Here's how you can buy a home with no down payment, right now.

How to Buy a House Without Down Payment

If you could live in your first home for zero bucks, would you still rent?

There are also down payment assistance available to help you get a mortgage without spending any money. Federal, state, and not-for-profit agencies—and even mortgage lenders—offer grants and loans to support first-time homebuyers.

Down Payment Assistance for First Home Buyers

A down payment assistance (DPA) can help you buy a house without cash right away. It is one of several federal, non-profit, and state programs for first-time home buyers.

USDA Loans No Down Payment

USDA loans have no down payment or minimum credit score requirements. These loans are made to increase home ownership in rural areas, these loans provide subsidized interest rates.

Applicants must be able to prove creditworthiness, as lenders require a credit score of 580 or higher in order to apply.

The requirements for a USDA loan applicant are as follows:

- Legal permanent residents of the US

- Proof of creditworthiness

- Reliable income

- Have a household income of 115% of the average income of the area, or lower

- Have a primary residence in rural areas

USDA mortgages can be used to purchase the following types of property: existing homes, production homes, new construction

townhouses, and condominiums, short sale.

Buyers are usually responsible for closing costs, lender fees, and mortgage insurance, although there is an opportunity to cover some of these costs by your seller or lender.

You can accept seller concessions and lender credits, where the seller and lender will pay some, or all, of your closing costs.

Conventional 97 Loans Program

Conventional Loans 97 from Fannie Mae allows borrowers to secure conventional loan mortgages for a 3% down payment.

No personal contribution required. Mortgage gifts, grants, and other DPAs may cover your down payment.

Conventional 97 Loans are an alternative to FHA loans, have less upfront costs, and no permanent mortgage insurance requirements.

Conventional 97 Borrowers must meet the following criteria:

1. Mortgages must have a fixed rate of interest

2. At least one borrower must be a first time home buyer

This loan cannot be used to buy production houses. Eligible property types include single-family homes of up to 4 units, condominiums, and planned developments.

VA Home Loans Without Down Payment

VA loans provide a way to purchase homes for US military members and veterans.

Like USDA loans, VA loans do not have a down payment requirement or credit score, although most lenders prefer a credit score of 580 or higher. (rocketmortgage.com)

You must have a certificate of eligibility (COE) in order to apply for a VA loan. This is to certify your career history and current duty status, to prove that you are qualified.

VA Eligibility Requirements

You are serving 180 days of active peacetime service

You are serving 90 days of active wartime service

You served six years in the National Guard

You are the spouse of a service member who dies in the line of duty, or is disabled, as a result of service.

A VA insures loans against loss with rights, which is similar to private mortgage insurance. This allows lenders to offer no-down-payment purchases with less risk and lower rates.

VA loan borrowers are exempt from certain closing costs, such as attorney and underwriting fees.

Conclusion

Low down payment and no down payment mortgages make home ownership possible for first time home buyers.

Find out which loan suits your condition, about how to buy a house without a down payment.

Then, get pre-approved for your mortgage of choice, once you're ready to start your house hunt.