fha "no down payment required"
You can still purchase a home without having to make a down payment. FHA will lend up to 97% of the purchase price for your home. Fortunately, guidelines still allow the 3% down payment to be made via a "down payment assistance" program. Believe it or not, virtually every home purchased with FHA loans are transacted with "no money down"! Additionally, the seller can pay your closing costs up to 6% of the purchase price. Typically, that will cover your closing costs in full. This is a very popular option with my clients as FHA loans feature fantastic bank rates, generous loan qualification guidelines, and have no pre-payment penalties.
how it works
1. First you will need to qualify for the FHA financing. FHA financing is much easier to qualify for than typical bank financing. Additionally, the monthly mortgage insurance (PMI) is about 50% of the cost for a typical bank loan. Even if you have limited or no credit, you may still qualify!
2. Secondly, you need to select the home you wish to purchase and get a purchase agreement. As part of that agreement the seller must be advised that you are obtaining FHA financing and you are utilizing a "down payment assistance" program. This information should be listed as a condition of your offer to purchase the home. If the seller agrees to your terms the seller will then enroll the home in the down payment assistance program by simply signing an enrollment form and paying a fee to the DPA program at closing. Additionally, you as the buyer will need to sign one form acknowledging that you will be receiving the 3% down payment as gift funds at closing.
3. Close your loan!
Need Help? Call me or email me with any questions you may have and I'll be glad to answer them for you. Whether you decide to purchase a home "For Sale By Owner" or you are using the services of a real-estate agent, I can help. I have the forms and information available. I can also recommend several real-estate agents that are very familiar with this program.
Alan Pressley
Office: (812)853-8860
Toll Free: (866)962-4810
Mobile: (812)573-5032
Email: apressley@acceptancecapital.com