Shopping for a new home is exciting for many first time buyers. It might be possible to obtain a mortgage loan without a 20 percent down payment toward the purchase price of a home. Perennial Funding offers a variety of financing options for qualified borrowers who are interested in buying a home with a low down payment mortgage loan.
The Department of Veterans Affairs provides government-backed financing for qualified borrowers. Generally, veterans and current service members who obtain a certificate of eligibility may be able to buy a home with a VA loan without making a down payment. Speaking with a licensed loan officer is the best way to find out about the specific requirements for VA home loans.
Lenders are often motivated to fund VA loans for eligible borrowers, as a portion of the loan is guaranteed by the Department of Veterans Affairs. While borrowers who are not disabled will pay a small funding fee toward a VA home loan, the interest rates and the loan terms are fairly competitive. Getting a VA mortgage loan with no down payment or a VA loan with a low down payment could enable a borrower to buy a home much sooner.
Buying a home with less than perfect credit could create a variety of financing challenges. However, the Federal Housing Administration offers government-backed mortgage loans that requires a borrower to provide as little as 3.5 percent toward the down payment for a home.
For instance, using an FHA mortgage loan, a borrower with favorable credit would need approximately $7,000 toward the purchase of a home that costs $200,000. With a below-average credit score or a marginal credit rating, an FHA mortgage loan might require a borrower to provide up to 10 percent toward the down payment for a home.
Our loan officers can quickly review an applicant’s qualifications for an FHA mortgage loan.
Eligible home buyers could use a conventional loan program from Fannie Mae to secure financing with a low down payment. With three percent toward the down payment on a home, qualified buyers could borrow the remaining 97 percent of the purchase price of a home via financing from Fannie Mae.
The best low down payment loan program will vary among applicants. A mortgage lending professional can help prospective borrowers find favorable terms for a home loan. Contact Tim Loss to get more details about affordable mortgage programs for first time home buyers.