4 Ways to Buy a Home With No Money Down

Buying a Home with no Down Payment

Buying a Home with no Down Payment

It can be difficult to come up with a down payment for your Burnet County Real Estate. There are mortgages available that can help reduce the down payment on your dream home and make it more affordable for you. There are four viable options to consider:

Option One: Zero-Down Mortgage as Low Income Applicant

  1. Gather the paperwork
  • Loan history
  • Employment history
  • Proof of address
  • Proof of income
  • Personal property value
  1. Meet with a loan officer
  • Let the loan officer know that you are trying to purchase a home with no money down
  • Make sure you have the documents for the officer
  1. Determine if you qualify
  • HUD offers very reasonable mortgages packages including little to no money down
  • FHA loans generally require at least at 3.5% down payment
  • The USDA may work with you in order to secure low income loans
  • Speak with your loan officer to determine your qualifications for these loans.

Option Two: Zero-Down Mortgage as a Veteran

  1. Contact the VA office in Texas
  • The GI Bill states that federal housing will be provided to veterans with no down payment
  • Veterans that have served in active duty for at least ninety days and were not dishonorably discharged are eligible.
  • There are often designated VA housing complexes available
  1. Figure out debt-to-income ratio
  • Figure up the total cost including monthly charges and other debt and divide that number by your monthly income
  • The maximum ratio to qualify for the VA zero down mortgage is 41%
  • If your ratio is over 41% there are other options to explore with you loan officer
  1. Apply for the loan
  • You will need to have the proof of military service form
  • Lenders are protected
  • Remember that just because you qualify for the loan doesn’t mean you will get it

Option Three: 80-20 Mortgage

  1. Determine if you qualify for 2 mortgages
  • If you have excellent credit you may qualify to take out a mortgage on the price of the home and a mortgage for the down payment
  • You will ultimately have two loans to pay off
  1. Be Careful
  • It can be difficult to get an 80-20 loan today due to the crisis of 2008
  • The home can lose value with this kind of loan
  • It will also cause a jump in interest rates and monthly payments
  1. Talk with your financial advisor
  • Be careful to avoid scams to get out of a down payment
  • Make sure to discuss your options with a financial advisor that you trust

Option Four: Foreclosed Home

  1. Research the foreclosed Burnet County Real Estate homes
  • Buying an FHA foreclosure may allow you to avoid a down payment
  • The home will more than likely require some labor and fixing up
  1. How much work to put in
  • Insured homes usually do not require much repair, insured with escrow homes will require some repair, and uninsured homes will need the most repair
  • If you’re not a DIY person, this may not be the best option for you
  1. Home inspection
  • Finding problems within the home through an inspection is a great way to avoid a down payment
  • Make sure that the inspector knows that you’re looking for structural damage
  • Make sure the damage is not going to cost you more than the home in the first place
  1. Estimate the repair costs
  • Figure up how much the material you’ll need to fix up the house will cost
  • Figure up labor costs for jobs you can’t do yourself
  • Also consider how long the repairs are going to take
  1. Apply for the 203k mortgage
  • Once the home is inspected, give the estimate to your loan officer and ask about the 203k
  • The loan offers money for the initial purchase as will as the repairs involved
  • There is a chance you will still need money up front, but it will be significantly less than usual
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