The number one obstacle when it comes to buying a home for most Americans is lack of down payment. We know saving for a down payment can seem daunting, but at Preferred Rate, we offer numerous loans with low down payment options, and even a couple with zero down payment! Our team can help you find the right program for you and make your dreams of homeownership a reality.
Which Programs Can I Buy a Home with No Money Down?
The loan programs that allow you to buy a home with no down payment are RD and VA Loans.
RD (Rural Development) Loans, also known as USDA Loans, are reserved for primary residences in rural areas. Some general requirements for RD Loans include:
- Location of the property
- Household income and asset limits
- Home must be the buyer’s primary residence
VA Loans are reserved for veterans and active duty service members, as set by the Department of Veterans Affairs. Some general requirements for VA Loans include:
- Valid COE (Certificate of Eligibility)
- Home must be the buyer’s primary residence
What Loan Programs Offer Little Money Down?
Conventional Loans and FHA Loans offer down payments as little as 3% and 3.5%, respectively.
FHA Loans are backed by the US government (like both USDA and VA Loans) and are a great option with flexible eligibility requirements. FHA Loans are for primary residences only and may be well-suited for borrowers who have a lower credit score and need credit flexibility.
Conventional Loans are the most common home loan type in Michigan. Conventional Loans are also the most versatile form of home loan, and are useful in a variety of situations. To qualify for the lowest down payment option, buyers must fall within the income limit set for the specific geographical area or be a first-time home buyer.
