Purchasing a home is a tremendous commitment, one that has an impact on your credit and funds like no other purchase could. Acquiring a home is usually regarded as a very good investment. With current interest rates, real estate experts encourage buyers to make a move.

money bags beside a model home on a balance scale

What if I have bad credit?

A bad history of credit can be a more significant hindrance for potential buyers than it had been previously because the current financial meltdown has triggered loan providers to tighten up their requirements for loaning funds as well as providing mortgages.

  • Get copies of your credit report and know your credit score.
  • Report any errors you find on your reports.
  • Begin to rebuild your credit with a secured credit card.
  • Make arrangements to pay outstanding debts.

What if I don’t have the down payment?

The vast majority of homes are purchased through mortgage loans, but most conventional mortgage loans require a 20% down payment. What if you satisfy all other requirements but donโ€™t possess the funds for that large sum of money needed for the down payment?

Let me reveal the best part! There are programs available to assist you in acquiring that home with no money down. Below are a few of the options that might work to help make your home ownership dreams come true.

USDA Loans (100% funding)

Generally referred to as โ€˜ruralโ€™ loans, that description doesn’t mean that you have to buy a home down the middle of nowhere โ€” a few suitable locations are actually in remarkably populated settings. Loans via the Department of Agriculture are available to individuals who have a decent credit history and a stable earning that doesnโ€™t go beyond certain median specifications.

Homes in some urban locations are not eligible. The prospective homeowner must not previously own a home. There is no mortgage loan insurance coverage on these loans; however, there exists a 2% upfront fee, which can be rolled into the mortgage loan, as well as an annual fee of 0.5% of the loan balance.

โ˜Ž๏ธ Contact RL Real Estate Group

Call or text Regan Laughlin and the RL Real Estate Group powered by eXp Realty at 605-212-8431!

Guaranteed Housing Loan

The Guaranteed Housing Loan caters to the average income borrower. People who apply may have an income of as much as 115% of the median earnings for the area. The Direct Housing Loan is for low-income households.

Guaranteed Housing Loans are dependent upon the credit and income requirements of both the lender as well as the USDA. Most lenders wantย  borrowers to have at least a 620 credit score without major delinquencies in the past several years.

Applicants need to present satisfactory credit history and demonstrate the capacity to pay off the mortgage. This commitment includes income taxes and insurance coverage.

VA loans (100% funding)

Department of Veterans Affairs loans help veterans and their surviving spouses to purchase a home with no money down. The normal rates of interest tend to be lower than those found in typical mortgage loans. Credit and income requirements are more flexible.

There is a financing charge, which might range from 2.15% to 3.3%, dependent upon the military outlet in which the applicant served, as well as the number of times they have taken out a VA loan. However, that funding fee can be rolled into the total loan.

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Summary
How to Buy a House with No Money
Article Name
How to Buy a House with No Money
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Dreaming of owning your own home but facing that problem of having no money for the down payment? There are solutions! Find out more here.
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RL Real Estate Group
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