There are lots of mortgages in which the buyer does not have come up with a huge down payment. Here are the top 4…

1) No Down Payment VA Loan

These are loans that are guaranteed by Veteran Affairs — formerly known as the Veterans Administration. These loans are designed for veterans who qualify for VA home loans. These loans do not require any money down to obtain loan approval. They actually originate through private lenders, but they are guaranteed by the VA.

Another great benefit with this type of loan is the fact that there are no mortgage insurance requirements. The borrower is required to pay what is known as a funding fee, but the fee can be rolled into the loan amount. The funding fee for VA loans varies, depending on certain criteria such as whether the veteran in question served in the regular military or the reserves, and whether it is the veteran’s first VA loan or a subsequent one. The funding fee can be anywhere from 2.15 percent to 3.3 percent.

2) Navy Federal Loan

The Navy Federal Credit Union, which is the nation’s largest credit union in memberships and assets, offers 100 percent home financing to all of its qualified members for buying homes that will be used as a primary residence. However, the eligibility is restricted to members of the military, civilian employees of the U.S. Department of Defense, and direct family members of the military.

3) Department of Agriculture Loans

The Department of Agriculture has what is known as the Rural Development mortgage guarantee program. This program is so popular that it has consistently run out of money before the end of the fiscal year. This means that the timing of the homebuyer’s application is vital. Many mortgage consultants list this program as their favorite to recommend to many of their clients. Despite the name of the program, its eligibility isn’t confined to rural farmland.

4) Federal Housing Administration (FHA)

The Federal Housing Administration offers a low down payment option to the general public. With a minimum down payment of 3.5 percent, a homebuyer can receive a guaranteed loan. In today’s market, about 15 percent of all mortgages are FHA insured loans. This is up by more than 12 percent from the market share that the FHA had during the housing boom. They have increased their market share due to the fact that many other low down payment options were eliminated when the housing bubble burst.

There Are Lots Of Creative Ways For Home Buyers To Get Financing

The problem is that many of these options are not commonly known by the average person. In most cases it’s wise to contact a mortgage broker or consultant to help find the best mortgage program for a particular situation. Working with the right mortgage officer will help alleviate the stress associated with finding an ideal lending situation.

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