Entering the housing market for the first time can be an elusive dream for so many would be homeowners. Down payments, closing costs, attorney fees, and so much more can thwart even the average buyer. If you have credit problems, little or no savings, or a low income, purchasing a home may be out of the question. On the other hand, there are programs available for buyers to help them purchase their first home. Many of these programs require little or no down payment, opening up a world of opportunities for those previously shut out of the home buying experience. Let's take a look at the various programs available to help you buy a home.
VA Loan
If you are a veteran, then the Department of Veteran's Affairs has a program that could be right for you. If you are eligible, a VA Loan could help you buy your dream house and with no money down. A VA Loan is available to both active and retired members of the military as well as to their unmarried widows. Your VA Loan isn't a one shot deal either; in 1989 Congress amended the law to allow for veterans to get a VA Loan on a later home purchase even if a VA Loan financed an earlier deal.
Lease Purchase or Owner Financing
Occasionally, you may come across an opportunity where the current owner of the home is willing to hold the home mortgage for you. With this particular situation, a traditional mortgage loan isn't required, although a signed agreement that has been reviewed by your attorney would be necessary to protect your rights. A lease purchase is another option for home owners struggling to raise cash for a mortgage loan down payment. In this situation the seller would come to an agreement with the buyer on the price of the home to be paid at a future date. In the meantime, the buyer would rent the home for a period of time with a portion of the rental income set aside as a down payment or returned to the buyer at closing.
State Programs
Depending on your state of residence, your state government could have programs in place to assist low income homeowners. In some states, big breaks in mortgage interest rates and home mortgage down payment requirements allow for new homeowners to purchase property. This can involve you purchasing property in a distressed area or purchasing a home that needs quite a bit of work. Some home mortgage programs are geared toward helping minorities, women, and people with disabilities, etc. Check with a knowledgeable local mortgage loan professional for programs in your area.
HUD - Housing and Urban Development
The Office of Housing and Urban Development has successfully helped make home ownership a reality for tens of thousands of buyers over the past several decades. Based upon need, the HUD program allows for first-time home buyers to get a home mortgage with little or nothing down. In some cases HUD covers mortgage loan closing costs too.
Special Mortgage Loan Programs
At any given time, there could be other programs out there that only a trained mortgage professional would know about. In some cities, low cost housing is made available to police who agree to move their families into troubled neighborhoods. In some states, farmers can get a loan with no money down. These change frequently, some seem to stay around, but others come and go. Check with a mortgage professional to find the loan that is right for you.
What About An FHA Loan?
For the record, the FHA {Fair Housing Authority} does not make mortgage loans - they insure them. An FHA loan is a bit of a misnomer as the loan is created through a home mortgage you get through a lender but it is backed by the FHA. If you default on an FHA loan the lender gets paid out of the FHA's funds. Unlike the other choices previously mentioned, you will still be required to come up with a down payment, but for as little as 3% instead of the typical 20% required by most lenders. An FHA loan is a good idea for the person not eligible for a no down payment loan, but still lacking the means to come up with a lot of money at closing.
Yes, you have options when it comes time to buying your first home. By checking out some of the no down payment offers, you could find yourself owning a home and getting out from underneath your landlord's influence. Consult a mortgage professional to learn exactly what home mortgage opportunities are available to you.
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Copyright: Copyright c 2006-2008 Frank Oakerson, All Rights Reserved
About the Author:Frank Oakerson is licensed loan officer #56753 in the state of Texas. I am available to assist you in purchasing your first home, bad credit mortgage, FHA Loan, VA Loan, etc. At http://www.yourmortgage123.com you will find a number of informative articles, mortgage calculators, info on VA loans, mortgage refinancing, stop my foreclosure, and getting pre-approved. Stop by and let me get started on a Texas mortgage for your property today.
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