FHA, VA and Rural Housing Provide Zero Down Options for Home Buyers

In today's economy, most consumers don't realize the dream of becoming a homeowner without mortgage programs that offer zero down financing. In spite of the many changes in the mortgage industry, some options are still available for no money out of pocket from the borrowers.

Many changes have occured in the mortage industry in the past 12 months which have reduced the options for borrowers to achieve homeownership. Some programs still exist allowing borrowers to achieve homeownership with no money out of pocket. FHA combined with a Down Payment Assistance Program, VA loans and Rural Housing all have options for no money out of pocket. All of these programs allow the seller to pay all or part of the closing costs.

FHA has come back in popularity in today's mortgage market. Although FHA does require the borrower to have 3% of their own funds into the transaction, they can satisfy this by receiving a gift from a qualified Down Payment Assistance Program such as the Nehemiah Program. Gift funds with FHA are considered the borrowers own funds. Contact a Mortgage Specialist to get more information on how the Down Payment Asssistance Program works. FHA loans have loan size restrictions, although they have temporarily increased those restrictions in many areas across the United States. FHA also has reduced monthly mortgage insurance compared to most conforming loan products. Contact a Mortgage Specialist to find out if you qualify for an FHA loan.

VA loans will continue to grow in popularity as veterans return back from the war. VA offers 100% financing with no monthly mortgage insurance. Benefits to veterans are determined by the veterans benefit awards letter. Additional benefits are available for disabled veterans. Contact a Mortgage Specialist to find out if you qualify for a VA loan.

USDA Rural Housing is another way a borrower can get into a property with no out of pocket money. Rural Houisng is a government agency that will provide 100% financing with no monthly mortgage insurance for lower income borrowers in rural areas. Typically this excludes counties that are considered metro areas, although some parts of these counties may be eligible. Contact a Mortgage Specialist to find out if you qualify for a Rural Housing loan and if your target area qualifies as rural.