You are tired of it. The failing appliances, the dreary exterior, the harsh interior. You just hate coming home to a rental property that you can't modify and invest in to truly make your own.
You want to buy a house, but with your current financial situation, you just can't cough up enough money for a 20% or even a low 10% down payment.
And thus arises the popular question: "can I buy a house with no money down?"
In this article, we will answer that exact question. With this answer under your belt, you will be one step closer to the end goal of being able to buy a house and get a mortgage for $0 down or close to it.
Can I Buy a House with No Money Down? Answered
As a general rule, when you are getting a home loan for a property you want to buy without putting any money down, you will have to do so using government-backed financing. This is because no private lender will lend out the full mortgage without any down payment.
With government financing, there are two options. The first is a USDA loan, and the second is a VA loan. But before you start dreaming of becoming a homeowner, it is important to note that both of these have strict criteria that you have to meet before you are approved for a 0% down loan.
USDA loans are backed by the US Department of Agriculture. These loans are very specifically for properties located in rural or sparse suburban areas. To check your location's eligibility, use the government website.
But 0% down VA loans, on the other hand, are open to several subsections of people who are in or have been in a branch of the military. Generally, if you are someone or are the spouse of someone who is a veteran (served at least 90 consecutive days in wartime or 181 days in peacetime), then you will be able to get a VA loan from a certified VA loan specialist.
How to Lower Your Mortgage Interest Rate
When you put 0% down on a house, the compromise that you make is a higher interest rate. Consequently, it makes sense to actively target lowering your mortgage interest rate even before you apply for the loan.
There are a couple of ways to do this. First and foremost, you should focus on getting your credit score up. Your credit score is one of the big determinants of the mortgage rate you end up with.
The higher your credit score, the lower your interest rate.
In a similar vein, also target reducing or eliminating as much debt as possible. The less debt you have, the better of a lender you will be to your financial institution of choice, and the lower your mortgage rate will be.
Become a Property Owner
There you have it homebuyers. Equipped with this guide, you should now confidently be able to answer the question, "can I buy a house with no money down?" Now buy your dream home for $0 down today!
For more property purchasing advice, check out the rest of the realty articles on the website before you leave! Visit the Real Estate section of the Bootstrap Business Blog to learn more about home ownership and mortgages.
