Can You Buy A Home Without A Down Payment?

10 February 2020
 Categories: , Blog


Are you planning to purchase a home? If so, you will probably need to finance the home, which will require you to find a lender. Some prospective home buyers are not familiar with the options that they have available to them. This is why it is a good idea to review loan options with a mortgage lender. Perhaps you aspire to own a home and may have heard about zero-down-payment loans and wondered whether you should consider applying for one. The following points will help you to understand more about reasons you may want to consider this option.

Good Reasons

This type of loan is ideal if you really want a home as soon as possible but have limited funds to invest. It can get you into a home soon without the burdens of needing to save for a new home. Some potential homeowners may not qualify for this type of loan if they have credit issues or lack a credit history. You may have someone close to you, such as a relative, who has decent credit and is willing to co-sign on the loan. You will also need to prove that you have employment or a stable business.

Bad Reasons

If you have the capital to make a down payment, it might benefit you to do so. This could result in lower interest rates, and you might pay your mortgage in full sooner. Perhaps you want to use the money you have saved to make repairs or enhancements to the home you purchase. Under these circumstances, a zero-down-payment loan could benefit you and raise the value of the property.

Costs Associated

Zero down payment does not mean that there will be costs associated with the purchase of your new home. You can expect to possibly need to pay associated costs, such as fees associated with the purchase, and to cover the costs for insurance and taxes.

A mortgage lender is a great resource to use to learn more about obtaining a mortgage loan for zero down. They can review your credit profile and identify factors that can improve your chances of securing this type of loan. Keep in mind that there are other types of loans that you could qualify for that may require a low down payment. You may have a special situation, such being a veteran, that could allow you to get approved for a VA loan. You may also qualify for other government loan options even if you are not a veteran or have a spouse with veteran status.