These loans usually require a low down payment of your own funds to purchase a home. However, for any conventional loan with less than 20% down, you will be subject to mortgage insurance on the loan. There are a couple of ways that the mortgage insurance can be paid. It can be a monthly charge on the loan or you can pay it in a lump sum up front. The up front lump sum can be a great option if you are purchasing a home and the seller is covering your closing costs.
FHA loans have been helping people become homeowners since 1934. The Federal Housing Administration (FHA) — which is part of HUD — insures the loan, so your lender can offer you a better deal. With low down payments, low closing costs, and easy credit qualifying, an FHA loan may be right for you.
- Ideal for first-time homebuyers, or buyers with limited funds
- May be eligible for a smaller down payment
- Fixed or adjustable interest rate
- Requires FHA mortgage insurance
- Balloon payment options not available
With no down payment required, eligible veterans, active duty personnel, national guard and surviving spouses can purchase or refinance a home. In addition, private mortgage insurance is not required. With a Certificate of Eligibility from the Department of Veterans Affairs you can purchase or refinance a home with limited closing costs and flexible credit criteria.
- Up to 100% financing for veterans of the U.S. Military
- Fixed/level payment of principal and interest for the life of the loan
- Monthly mortgage insurance not required
- No down payment required in some cases
Are you ready to own a home but concerned you won't qualify because of the down payment? Rural Development may be able to help you. USDA (Rural Development) has partnered with local lenders to help them extend 100% financing opportunities to individuals and families.
- For purchasing rural housing or property
- Long-term, fixed interest rate
- Income limits apply
- Ideal for first-time homebuyers
- Low to no down payment
The Home Affordable Refinance Program (HARP) is a government program that was established in 2009 for Fannie Mae and Freddie Mac held mortgages. HARP provides the opportunity for homeowners to refinance at a lower rate when they have "Under Water Mortgages." A HARP Refinance addresses situations where the homeowners’ property value has fallen, causing them to no longer qualify under traditional underwriting criteria. Homeowners with a loan owned by Freddie Mac or Fannie Mae have the opportunity to refinance without an appraisal.