Buy a House With No Money Down
Beware: The current subprime loan woes has rendered
home buying with no money down almost impossible in the
current market situation now. As such, the information below may not be
accurate anymore. Please read with caution!
Buying a home is one of the smartest financial moves a person can make. A house provides
much more than just a roof over your head; it can be a great investment and
a major source of wealth over the years. Home prices have been rising steadily for
many years, regardless of the overall direction of the economy at large.
While buying a home has always been a good financial decision, it is becoming harder
and harder for buyers today to scrape together the thousands or tens of thousands of
dollars it takes to put a down payment on the home of their dreams. With the median
home price now exceeding $180,000, a 20% down payment amounts to a staggering
$36,000. It is no secret that few people have that kind of cash laying around to
provide a down payment. So, how do you buy a house with no money down?
Fortunately there are programs available that help first time home buyers and others
to purchase a home with little or even no money down. Many lenders are taking
advantage of the seemingly endless rate of home appreciation to write mortgage loans
for 90%, 95% or even 100% of the assessed value of the home to be purchased.
There are also a number of specialty mortgage vehicles available to the buyer who
does not have a down payment to offer. There are interest only loans that allow the
home buyer to pay only the interest on the loan for a period of time. There are
variable rate and adjustable rate mortgages that allow the buyer to put only a small
amount down, or sometimes nothing at all.
There are also programs that allow the buyer to take out a mortgage, and then turn
around and take out a second mortgage to cover the cost of the down payment. Some of
these programs are riskier than others, but they do allow the buyer to buy a house with
no money down.
Other popular ways in which eligible home buyers can get into the home of their
dreams for little or no money down include owner financing, VA loans, lease/purchase
agreements, and federal, state and local loan programs.
A real estate agent who is well versed in these state, federal and local loan
programs can help the potential home buyer to find the programs for which he or she
is qualified. Many states and municipalities have programs in place that encourage
renters to become homeowners, and these programs often include help with the down
payment. Depending on your income and your location, you may be eligible for a grant
to cover the down payment on the home. Your real estate agent can help you complete
the forms you may need to apply for these great programs.
The bottom line is this: it is possible to buy a house with no money down!
Do not let the lack of a
home down payment keep you from making one of the most important financial investments of your life. A home of your own is
a major asset, and one that appreciates year after year.