Buying a Home with No Down Payment

The road to home ownership starts with a hefty down payment. Or does it? While a meager savings account does seem to be a challenge when you are considering purchasing your first home, it’s not a necessarily a deal breaker. There are ways to go about buying a home with no down payment. Here is a look at where you can start.

1. Prove your worth. This includes your tax returns, pay stubs, W-2s and bank statements. If you have other assets, such as stocks and other investments, include those in your documents. Collect credit card statements that prove you are always timely with your payments and anything else that shows what you are worth and could possibly help convince lenders that you are financially stable enough to lend you the money. Also provide evidence of your stable employment status, as well as a summary of your monthly expenses.

2. Find someone to cosign. If you can find a reliable cosigner who has good credit, it will greatly improve your chances of securing the loan. Having a cosigner may also help you get a better term or even a lower interest rate. However, asking someone to be a cosigner is not an easy task. Your cosigner will be a co-borrower on the loan, and the mortgage will show up on his or her credit report. If you should default on the loan, the cosigner will be held responsible for the balance.

3. Look at different loan options. Obtaining a loan with a bank is not your only option. There is government, state and special circumstances loans that you just may qualify for. Here are 4 other options for you to consider.

• FHA loan. This loan is insured by the federal government and its participating

• VA loan. If you are military, or ex-military, you may qualify for a Veterans Affairs

• USDA Rural Development Housing loan. If you live in a particularly rural area, you

• Homebuyer incentive programs.

Almost all states have some sort of homebuyer incentive program. The assistance can range from down payment help to lower interest rates, or a combination of different things. These programs are usually subject to income guidelines, and many are only open to first-time homebuyers. Check with your state and country offices to see what is available in your area, and if you meet the necessary income requirements.

Buying a home doesn’t have to be dependent on a having a large down payment. By having a good financial track record, getting someone to cosign your loan or looking into other loan options, you can buy a home sooner that you think.

Gunderson, Denton & Peterson, P.C.

Mesa Location:
1930 N Arboleda #201
Mesa, Arizona 85213
Office: 480-655-7440
Fax: 480-655-7099

Phoenix Location:
40 N Central Ave #1400
Phoenix, AZ 85004
Phone: 480-325-9937