Low Down Payment Mortgage Options

Each of us does come to a point in our lives where we need to supplement our existing finances for a specific need. Particularly so when we plan to buy a new home and we require additional finances. Since buying a new home is a long-term financial commitment one needs to carefully plan it. Several mortgage programs ask for some down payment. To put down an initial amount say about 20% of the sale price of the home is very difficult for the salaried class people although buying a house is a great financial bet in today circumstances with several tax incentives offered for the house owners. So search for options that are tailor made to suit your finances and go ahead in buying a new home.

There are a variety of low down payment mortgage programs and they should help everyone realize their dream of buying new home a reality.

Government-backed Mortgages

These loans are for first time homebuyers and they can be either local backed or state backed loans. To get either of these a borrower should meet some criteria. The person must have an income source and should have willingness to buy a home in a specified area. These loans are a good choice for newbies and they are also accompanied by low down payments and subsidized interest rates.

Federal Housing Administration (FHA) Mortgages

These are an easily obtainable loans and many people vote for it. They come with a low down payment (just 5%). The criteria are also simple and laid out by the Department of Housing and Urban Development. One big advantage that the borrowers can avail of with FHA loans is that they can use up to 41% of their respective gross income to pay off the debt. This sets FHA mortgage apart from the rest.

Department of Veterans Affairs (VA) Mortgages

These are specifically meant to cater to the veterans who wish to buy new homes for themselves and their families. These mortgages come with zero down payments. The VA mortgage borrowers also can use 41% of their gross income to pay off debts. Furthermore, VA mortgage lenders are not harsh with borrowers regarding late payments etc.

Rural Housing Mortgages

These are loan plans that are specifically tailored to farmers. However, even otherwise some borrowers can qualify themselves for availing this mortgage if they are willing to buy a home in a rural area. The Rural Housing Mortgages are very popular in some areas and is commonly enticed brand of mortgage over there. The mortgage does not usually call for a down payment and is accompanied with low interest rates.

Community Homebuyer Program

Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac) together run this mortgage program through their network of lenders in different places. This program is designed to mortgage for a group who intend to buy a set of houses. The down payment is fixed at 5%. Additionally, the borrowers can make use of up to 38% of their gross income towards paying off debt.

With so many low down mortgage programs you can pick the one that suits your finances and make your dream of buying new home a reality.