Are you ready to purchase a home but want to avoid paying the hefty down payment? 

Did you know that you can buy a property without having 20% down? Yup! You read that right. While cash and the stock market can be volatile in recessions, real estate is considered one of the safest investments historically. With so many investment opportunities out there, more and more people are putting their money into real estate rather than focusing on saving up.

You can invest in real estate without a massive down payment. Here are FOUR excellent choices for home loans that you may qualify for:

1. FHA MORTGAGE

If you're struggling to get loan approval or have credit challenges, then the Federal Housing Administration's 3.5% down payment option may be just the loan for you. This loan is especially popular with first-time home buyers.

According to Investopedia,

1. FHA loans are mortgages intended for certain borrowers who find it difficult to obtain loans from private lenders.
2. The federal government insures FHA loans.
3. FHA borrowers tend to be riskier, and so must pay higher interest rates and pay PMI.
4. Because they are insured, banks are more willing to loan money to homebuyers with relatively low credit scores and little cash to put down on the purchase.
5. First-time homebuyers may find that an FHA loan is the most affordable mortgage option.

FHA loans are a great option for borrowers who don’t have great credit or don’t have a lot of money to use for a down payment. However, keep in mind that the long-term costs of an FHA mortgage will be higher due to the unavoidable mortgage insurance payments involved.

2. VA,NO MONEY DOWN LOAN

The VA loan is designed to help active-duty members, veterans, and surviving spouses secure their new homes with zero down payments. This loan offers the lowest rates of ANY mortgage and insurance exceptions.

VA helps Servicemembers, Veterans, and eligible surviving spouses become homeowners. As part of our mission to serve you, we provide 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.

1. No down  payment required 
2. (*Note: Lenders may require down payments for some borrowers using the VA home loan guaranty, but VA does not require a down payment)
3. Competitively low interest rates
4. Limited closing costs
5. No need for Private Mortgage Insurance (PMI)
6. The VA home loan is a lifetime benefit: you can use the guaranty multiple time

VA loans are arguably the most powerful loan option on the market. They come with a list of big-time benefits, including $0 down payment, no mortgage insurance, flexible and forgiving credit guidelines and the industry's lowest average fixed interest rates. Every Veteran buyer's situation is different, and going over all of your loan options with a home loan specialist can help ensure you make the best financial decision possible.

3. CONVENTIONAL 97 LOAN

This is where you can get into a house with just 3% down. On a $350,000 home, you'd need $10,500 to make a 3% down payment. Compare that to the whopping $70,000 you'd need for 20% down. This conventional loan is a gamechanger for many homebuyers.

1. Loan Limits: Loan amount must not exceed conforming limit for the county in which the property is located
2. Loan Type: Must be a fixed-rate mortgage with a term not exceeding 30 years
3. Property Type/Eligibility: Must be owner occupied. Cannot be an investment property. Eligible property types include: Single-Unit family home, Cooperative, Condominium and Planned unit development (PUD)
4. Mortgage Insurance: While no upfront fee is required, borrowers must pay private mortgage insurance (PMI), a standard for conventional loans of 80% LTV or higher. PMI is typically removed once the borrower’s LTV reaches 78%.
5. Down Payment: No less than 3% of purchase price. No minimum contribution from borrower required. Payment can be sourced from: Gift funds, Down payments sourced from a gift may raise the credit requirement for the loan, Community seconds, Grants and Seasoned cash-on-hand.

4. USDA MORTGAGES

These affordable, fully-financed, US Department of Agriculture-backed loans require zero down and are perfect if you're moving to a rural area where you earn below 115% of the median income.

A USDA home loan is a competitively priced mortgage option that helps to make purchasing a home more affordable for low-income individuals living in designated rural areas. The U.S. Department of Agriculture backs USDA loans in the same way the Department of Veterans Affairs backs VA loans for eligible individuals such as veterans and their families.

This government backing means compared to conventional loans, mortgage lenders can offer lower interest rates in many cases. If you qualify, you can buy a home with no down payment, although you’ll still need to pay closing costs.

1. The United States Department of Agriculture (USDA) provides mortgages of last resort to the people in rural areas who need them the most.
2. Qualification standards for these home loans are lenient compared to those of other mortgages, but you will need a steady income that's high enough to repay the loan over 30+ years at a fixed interest rate.
3. The definition of "rural" is broader than you might think. The rules for the Direct Loan program define an eligible rural area as having less than 35,000 residents.

Well, there you have it- just a few low-down-payment loan options that may be available to you, depending on your unique situation. If you have questions such as "What mortgage can I afford?" or "How mortgage works?", don't worry! For any of these loan options or to discuss additional options, you can simply give us a shout. We will connect you with our home loan expert so you can start putting your money to work in a new home today!