Zero Down (100% Financing) Has Not Gone Away!

VA Loans

VA guaranteed loans are made by lenders and guaranteed by the U.S. Department of Veteran Affairs (VA) to eligible veterans for the purchase of a home. The guaranty means the lender is protected against loss if you fail to repay the loan. In most cases, no down payment is required on a VA guaranteed loan and the borrower usually receives a lower interest rate than is ordinarily available with other loans.

Other benefits of a VA loan include:

• Negotiable interest rate.
• Closing costs comparable – and sometimes lower - than other financing types.
• No private mortgage insurance requirement.
• Right to prepay loan without penalties
• Mortgage can be taken over (or “assumed”) by the buyer when a home is sold.
• Counseling and assistance available to veteran borrowers having financial difficulty or facing default on their loan.

Although mortgage insurance is not required, the VA charges a funding fee to issue a guarantee to a lender against borrower default on a mortgage. The fee may be paid in cash by the buyer or seller, or it may be financed in the loan amount.

A VA loan can be used to buy a home, build a home and even improve a home with energy-saving features such as solar or heating/cooling systems, water heaters, insulation, weather-stripping/ caulking, storm windows/doors or other energy efficient improvements approved by the lender and VA.

Veterans can apply for a VA loan with any mortgage lender that participates in the VA home loan program. A Certificate of Eligibility from the VA must be presented to the lender to qualify for the loan.

USRD - Rural Development Guaranteed Loan Program

This loan is a true 100% product with the ability to add closing costs to the loan if the appraisal comes in higher than the sales price. There is NO monthly mortgage insurance either, just an upfront administrative fee that is financed into the loan. There are income limitations and there are eligibility areas for the property address. We can help determine your ability to use this loan with a quick application and can provide you a map of eligible areas. Just because "Rural" is in the name, you will be quite surprised at how close to a downtown core you can use this loan in. Starting January 20, 2009, the income limits will move from an 8 tier to a 2 tier system, allowing a family of up to 4 people to make up to $76,100 and qualify for this loan.

This has not changed. You can use an FHA loan and get a gift for the down payment from a relative, an employer (as part of a published employee benefit program), or from a grant from a government authority. Pierce County has a grant program allowing for a grant of up to 3% of your down payment and 3% closing costs. You will still make a small investment yourself into the transaction and there are income guidelines. We will check the availability of this for you when you make your loan application.

So, there still are many ways to buy a home with little to NO money down. It just takes an experienced Mortgage Advisor knowing what is available and how to get the job done. Why don't you start today by getting pre-approved and getting your questions answered!