Don't let a big down payment keep you from buying a home. Here are a few mortgage options that require as little as... very low down-payment, THE 12 GREATEST ADVANTAGES IN REAL ESTATE INVESTMENT,, Real Estate Investing: Commercial Real Estate Investing For Profits. HOW, WHEN & WHERE, WHY?
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COMMERCIAL REAL ESTATE; A BETTER WAY TO INVEST TO BUILD WEALTH, TO CREATE FORTUNE AND TO SECURE A FINANCIAL FUTURE
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COMMERCIAL REAL ESTATE; A BETTER WAY TO INVEST TO BUILD WEALTH, TO CREATE FORTUNE AND TO SECURE A FINANCIAL FUTURE
Does your dream of buying a home seem out of reach? Well, you're not alone. Many aspiring homeowners don't think it's realistic to be able to save up for a big down payment.
But don't get discouraged so easily. With some programs, you might be able to get a loan with as little as .... down, though it usually comes at a cost.
"These programs typically come with a higher interest rate, but for the right borrower [they] are a great alternative to renting," says Anthony of visionaire Business Center
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The lower your down payment, the higher your monthly payments will be since you are borrowing more money.
And putting down less than 20 percent means that you'll have to pay mortgage insurance on top of your regular monthly payments. This insurance protects the lender in the case of a borr ower defaulting on a loan.
So if you're willing to deal with those costs to fulfill your homeownership dreams, there may be a program for you. Read on for several programs requiring little or no down payment from qualified applicants.
Commercial Real Estate Investing 101 By Antony Jeanty - Licensed Real Estate Professional, Realtor And Investor.
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Like the idea of putting down just one hundred bucks to buy a house? The FHA $100 Down Program may be just what you need. But is $100 really all that's required?
"The name of the program is slightly misleading according to certain people ,"
Buyers may be responsible for some of the closing costs, ; the cost of a home inspection (if applicable) and other items such as legal fees, which are approximately $1,000, to $3,000.
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REAL ESTATE INVESTMENT: HOW AND WHERE TO FIND MONEY TO BUY A PROPERTY}
Another caveat? Borrowers using this program are restricted to buying a HUD foreclosure.
"A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage," says the HUD website.
HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim."
Additionally, the borrower must purchase the home through the regional HUD office, which must be offering the $100 down only incentive.
Additionally, buyers may pay more than the home is worth if there is a bidding war for the home, says Bakke. If the bidding price exceeds the home's value, the buyer will have to come up with the difference between the sale price and HUD's appraised value on their own
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Well, with a Federal Housing Administration (FHA) loan, your down payment can be as little as 3.5 percent of the purchase price of a house, according to the U.S. Department of Housing and Urban Development (HUD) website.
If that's still out of your budget, then you may be able to go even lower with an FHA down payment assistance program. How exactly is that possible?
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"FHA allows government entities and non-profit organizations to issue second mortgages to cover the required 3.5 percent down payment," says Van Dyke. How? Well, these programs offer qualified applicants loans or grants for their down payment - the latter being an even better option since that's money that doesn't need to be paid back.
This essentially means that you could secure a mortgage with zero down through a down payment assistance program - a boon for cash-strapped homebuyers.
But usually, the borrower must pay the money back by making payments on a low-interest rate loan. In some FHA down payment assistance programs, the debt can be forgiven if the borrower lives in the home for the period of time specified in the agreement, says Anthony of knowledgefinancial.com
Georgiades explains that there are different types of down payment assistance programs - some are geared toward police officers, teachers, veterans or firefighters. Other assistance programs are designed for homeowners who earn less than the median income of the area where the home is located.
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Under this program, officially known as the USDA Rural Development Single Family Housing Guaranteed Loan, the closing costs can be financed as well.
As part of the Community Reinvestment Act, he explains, banks and other financial institutions may provide special financing within certain zip codes.
"The Community Reinvestment Act is a federal law, part of the Housing and Community Development Act of 1977,"
"Banks are willing to provide special financing because of it, because they are regulated and audited by the government from time to time for compliance."
So how do you qualify? The main factor is income. Applicants must be US citizens who may earn up to 115 percent of the median income of the area in which they're applying, and the area of the home is key.
"USDA Loans are only for rural use so the area where the home is located must have a population of 10,000 or less,".
But don't get discouraged so easily. With some programs, you might be able to get a loan with as little as .... down, though it usually comes at a cost.
"These programs typically come with a higher interest rate, but for the right borrower [they] are a great alternative to renting," says Anthony of visionaire Business Center
------------
The lower your down payment, the higher your monthly payments will be since you are borrowing more money.
And putting down less than 20 percent means that you'll have to pay mortgage insurance on top of your regular monthly payments. This insurance protects the lender in the case of a borr ower defaulting on a loan.
So if you're willing to deal with those costs to fulfill your homeownership dreams, there may be a program for you. Read on for several programs requiring little or no down payment from qualified applicants.
Commercial Real Estate Investing 101 By Antony Jeanty - Licensed Real Estate Professional, Realtor And Investor.
-----------
Option #1: FHA $100-Down Program
Saturday, November 23, 2013
Mortgage Home Loan Pre-Approval Process Made Easy By Anthony Jeanty From: Buy Here Market Enterprise. Mortgage Pre-Approval Q&A - Getting Pre-Approved for a Loan.
"The name of the program is slightly misleading according to certain people ,"
Buyers may be responsible for some of the closing costs, ; the cost of a home inspection (if applicable) and other items such as legal fees, which are approximately $1,000, to $3,000.
------------
REAL ESTATE INVESTMENT: HOW AND WHERE TO FIND MONEY TO BUY A PROPERTY}
Another caveat? Borrowers using this program are restricted to buying a HUD foreclosure.
"A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage," says the HUD website.
HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim."
Additionally, the borrower must purchase the home through the regional HUD office, which must be offering the $100 down only incentive.
Additionally, buyers may pay more than the home is worth if there is a bidding war for the home, says Bakke. If the bidding price exceeds the home's value, the buyer will have to come up with the difference between the sale price and HUD's appraised value on their own
------------
Option #2: FHA Down Payment Assistance Programs
Buying a home with 20 percent down may not seem realistic. But what if you could knock that number way down?Well, with a Federal Housing Administration (FHA) loan, your down payment can be as little as 3.5 percent of the purchase price of a house, according to the U.S. Department of Housing and Urban Development (HUD) website.
If that's still out of your budget, then you may be able to go even lower with an FHA down payment assistance program. How exactly is that possible?
------------
"FHA allows government entities and non-profit organizations to issue second mortgages to cover the required 3.5 percent down payment," says Van Dyke. How? Well, these programs offer qualified applicants loans or grants for their down payment - the latter being an even better option since that's money that doesn't need to be paid back.
This essentially means that you could secure a mortgage with zero down through a down payment assistance program - a boon for cash-strapped homebuyers.
But usually, the borrower must pay the money back by making payments on a low-interest rate loan. In some FHA down payment assistance programs, the debt can be forgiven if the borrower lives in the home for the period of time specified in the agreement, says Anthony of knowledgefinancial.com
Georgiades explains that there are different types of down payment assistance programs - some are geared toward police officers, teachers, veterans or firefighters. Other assistance programs are designed for homeowners who earn less than the median income of the area where the home is located.
------------
The [down payment assistance] funds can be used with any loan type, including FHA, VA, USDA, or conventional, he says.
However, there are some limitations to these FHA down payment assistance programs.
"Unlike normal FHA [loan] rules, non-occupant borrowers (co-signers) are not allowed," Additionally, there is a limit to the purchase amount of the home with down payment assistance, and the borrower must usually have at least a 640 FICO credit score to apply. Finally, even if they don't have the cash, borrowers must show they own something of value
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"VA Loans are made for veterans, active duty military, and the surviving spouses of military members that have died as a result of service,"
VA loans are different from other low down payment programs, because they have lower interest rates than conventional mortgages, and are very easy to qualify for, he says.
"Unlike conventional mortgages, they do not require excellent credit and allow for higher debt-to- income ratios. A debt-to-income ratio (DTI) compares an individual's debt payments to his or her income and measures how likely it is that a borrower will repay a loan.
Under recent regulations under the 2014 Dodd-Frank Act, the recommended DTI is 43 percent when approving mortgages. But some lenders who offer VA loans allow a borrower to have a DTI as high as 70 percent, says Georgiades.
"We know of lenders that will also allow borrowers to get a VA loan with a FICO score as low as 530 with extenuating circumstances," Other lenders will originate FHA loans with a FICO as low as 600."
Another perk of the VA loans? No mortgage insurance required, though there is an additional fee.
"Unless the borrowers receive disability income from the VA, they will have to pay a funding fee, but this can be included in the mortgage amount,"
The funding fee ranges from 2.15 to 2.4 percent of the loan for first-time homebuyers and 3.3 percent for subsequent home purchases, according to the Department of Veterans Affairs. Charging this fee to homebuyers reduces the loan's cost to taxpayers, especially considering that a VA loan doesn't require a down payment or mortgage insurance.
While this all may sound ideal, be aware that there are some drawbacks to this program, according to Anthony Real Estate Professional, Realtor in the state of Florida.
"Most [real estate] agents do not understand the program and are shy to accept an offer that has VA financing," he says. In addition, only veterans or active-duty military and their spouses can apply for the loan, and VA loans cannot be used to purchase an income property.
However, there are some limitations to these FHA down payment assistance programs.
"Unlike normal FHA [loan] rules, non-occupant borrowers (co-signers) are not allowed," Additionally, there is a limit to the purchase amount of the home with down payment assistance, and the borrower must usually have at least a 640 FICO credit score to apply. Finally, even if they don't have the cash, borrowers must show they own something of value
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Option #3: Zero-Down VA Home Loan Program
The FHA isn't the only government agency offering low down payment loans for homebuyers. The U.S. Department of Veteran Affairs has a VA loan for military members."VA Loans are made for veterans, active duty military, and the surviving spouses of military members that have died as a result of service,"
VA loans are different from other low down payment programs, because they have lower interest rates than conventional mortgages, and are very easy to qualify for, he says.
"Unlike conventional mortgages, they do not require excellent credit and allow for higher debt-to- income ratios. A debt-to-income ratio (DTI) compares an individual's debt payments to his or her income and measures how likely it is that a borrower will repay a loan.
Under recent regulations under the 2014 Dodd-Frank Act, the recommended DTI is 43 percent when approving mortgages. But some lenders who offer VA loans allow a borrower to have a DTI as high as 70 percent, says Georgiades.
"We know of lenders that will also allow borrowers to get a VA loan with a FICO score as low as 530 with extenuating circumstances," Other lenders will originate FHA loans with a FICO as low as 600."
Another perk of the VA loans? No mortgage insurance required, though there is an additional fee.
"Unless the borrowers receive disability income from the VA, they will have to pay a funding fee, but this can be included in the mortgage amount,"
The funding fee ranges from 2.15 to 2.4 percent of the loan for first-time homebuyers and 3.3 percent for subsequent home purchases, according to the Department of Veterans Affairs. Charging this fee to homebuyers reduces the loan's cost to taxpayers, especially considering that a VA loan doesn't require a down payment or mortgage insurance.
While this all may sound ideal, be aware that there are some drawbacks to this program, according to Anthony Real Estate Professional, Realtor in the state of Florida.
"Most [real estate] agents do not understand the program and are shy to accept an offer that has VA financing," he says. In addition, only veterans or active-duty military and their spouses can apply for the loan, and VA loans cannot be used to purchase an income property.
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Option #4: USDA Home Loan
If you're not much of a city slicker and instead dream of a home in a rural area, a USDA loan may be a good option for you. Why? Well, for starters it doesn't require any money down.Under this program, officially known as the USDA Rural Development Single Family Housing Guaranteed Loan, the closing costs can be financed as well.
As part of the Community Reinvestment Act, he explains, banks and other financial institutions may provide special financing within certain zip codes.
"The Community Reinvestment Act is a federal law, part of the Housing and Community Development Act of 1977,"
"Banks are willing to provide special financing because of it, because they are regulated and audited by the government from time to time for compliance."
So how do you qualify? The main factor is income. Applicants must be US citizens who may earn up to 115 percent of the median income of the area in which they're applying, and the area of the home is key.
"USDA Loans are only for rural use so the area where the home is located must have a population of 10,000 or less,".
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FHA Mortgage Home Loan Programs: Federal Housing Administration (FHA) Visionaire Business Center
The Federal Housing Administration (FHA)
What is the Federal Housing Administration?
The Federal Housing Administration, generally known as "FHA", provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories.
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USDA Loan Program: Your Guide to USDA Rural Development Mortgage Home Loans {Financial Knowledge}
USDA Loan Mortgage: Introducing The No Money Down, Low And Fixed Rates USDA HomeLoan For Suburban Communities.
USDA Home Loans
What is a USDA Home Loan?
USDA Home Loans provide up to 100% financing for a home purchase or refinance. These loans are guaranteed by the USDA and are serviced by direct lenders that meet federal guidelines. There are many qualifying factors for a USDA home loan, things such as income limits and loan amount may limit eligibility. READ MORE...
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VA Loan: The VA Home Mortgage Loans - Veterans Benefits Administration. {Financial Education}
VA Home Loans, Veterans Benefits Administration.
What About VA Home Loans?
VA helps Servicemembers, Veterans, and eligible surviving spouses become homeowners.
VA mission to serve you, VA provides a home loan guaranty benefit and other housing-related programs to help you buy, build, repair, retain, or adapt a home for your own personal occupancy.
