Is there really such a thing as no money down home loans?  Well the short answer is yes, but the much more complicated accurate answer would be NO!  However there are 3 programs that fit the “no money down” archetype and should be applied where available.

If you’re a veteran, you might be able to get a VA loan with no down payment from the U.S. Department of Veterans Affairs (VA). In order to qualify for the loan — you’ll need good credit, enough income and a Certificate of Eligibility from the VA— but if you do, you may be able to enjoy these perks: no down payment on the home (as long as the sales price isn’t higher than the appraised value of the home), no private mortgage insurance premium and limited closing costs.

The second option for a no down payment loan is a USDA loan. The United States Department of Agriculture offers a variety of these loans with low interest rates. Most of the loans are designed to help low- or moderate-income people with decent credit buy a home in a rural area.

NOTE: Two of the more popular USDA loans are the single-family direct homeownership loan and the single-family guaranteed homeownership loan.

The single-family direct homeownership loan is for low- or very low-income borrowers purchasing homes in rural areas. Eligible propertiesmust be 1800 square feet or less with a market value below the applicable area limit. No swimming pools or properties designed for income-producing activities are allowed. The householdadjusted income of the borrower must not exceed the applicable low-income limits for the area.

The single-family guaranteed homeownership loan helps those with incomes that are below 115 percent of the median income for the area buy modest homes in rural areas.

The final option is a Down Payment Assistance Program aka DPA Program. The FHA does not offer a no-money down loan. However, they do allow for loans with a down payment as low as 3.5% of the home’s purchase price. This is where the “DPA Program” come in.  They will cover the 3.5% for you allowing you to not have to put money down!  Sounds great right!  Well it is once you jump through the hoops to get qualified and close on the home.  They all have their challenges but if you are willing to have some patients it is possible to make that program work for you!

The most popular DPA Program in Atlanta is the GA Dream followed by the National Homebuyers Fund aka NHF.

The GA Dream: The Georgia Dream Homeownership Program provides first mortgage loans, down payment assistance and home buyer education to eligible home buyers. An eligible borrower must not have owned a home in the past three years, or must be purchasing a home in a targeted area. The borrower must meet income and purchase price limits, have limited assets, and must invest at least $1,000 into the purchase transaction.

NHF: DPA grant decreases home buyer costs, avoids burdening the home buyer with additional debt and eliminates property liens associated with secondary financing options.

This also creates a long-term positive domino effect because the housing market is infused with borrowers holding more equity for a future move-up purchase if they desire, in turn freeing up another potential entry-level property.

A.  DPA grant never has to be repaid.

B.  Grant reduces debt and creates positive home equity.

C.  Grant creates a positive impact on housing economy.

Sooo.. Which program is right for you!

If you are interested in checking your eligibility for the GA Dream call 404-578-1749.

Kevin Dolby Headshot
Phone: 404-578-1749
Dated: September 29th 2017
Views: 681
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