When looking to buy a home, especially as a young first time home-buyer potentially just starting out, the words "down payment" can seem a bit daunting. Luckily, being that it is a buyer's market these days, there are loan programs allowing for little to no down payment and seller paid closings costs. Hence, you can get into a home for the costs of a home inspection and an appraisal fee... which all may cost under $1,000.
USDA, FHA & VA loans are the most common programs allowing for:
- Minimal down payment or "no down payment",
- Flexible underwriting guidelines and minimal score requirements
- Greatest buying power...aggressive debts to income ratios
- All of these products allow "seller paid closing costs"...which means that the seller pays for all the closing and prepays costs out of their negotiated purchase price
USDA:
- 620 minimal score
- 100% financing..NO down payment
- Specific Lending areas http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do
- Seller paid closing cost
- No reserves
- Low monthly mortgage insurance=greater buying power
- Low interest rates
FHA:
- Minimum credit score 580
- Limited Trades lines
- 3.5% down payment
- Gift funds allowed for down payment and closing costs
- Seller paid closing costs allowed
- Low interest rates
VA:
- 100% financing NO down payment
- Military Mortgage product
- NO monthly mortgage insurance
- Seller paid closing costs
- Low interest rates
This is just an overview.. with rates being this low, as well as this being a buyers market..there's no better time, and your money invested than in buying a home... stop renting and start owning.
With further questions about USDA, FHA, and VA loans please feel free to blog me or contact me at Dorothy@fundsforhomes.com or 860-833-1083.
