Zero Down Mortgage

Posted on August 15, 2014 by Ray Williams (NMLS #216267).

Looking to purchase outside of the city?  Would you like to put zero down? Needing more space between you and your neighbors? For a little while now rural areas are becoming a popular area to purchase, such as Firestone, Frederick, Dacono and Ft. Lupton. There are some great reasons to move out into these areas and not just because of the cost of housing and space. Did you know, in these areas you could possibly qualify for a zero down mortgage?

Yes, I said zero down.  These areas are approved for the USDA/RD loan.  A USDA/RD loan is one of the best loans out there alongside the VA loan.  This loan allows for a zero down payment, has a lower rate and a lower mortgage insurance (MI) premium.  The MI is lower than an FHA loan. So this can allow you to buy more home for less per month. Of course, there are certain restrictions on this loan program.

Last month we helped a single mom get into a home using a USDA loan.  As a single mother, it is hard to save money for a down payment. She originally came to us looking into the grant program for help with down payment.  Not only were the interest rates for the grant programs slightly higher but because the grant program is with an FHA loan the monthly mortgage insurance is higher than a USDA/RD loan. This, in turn, made her monthly payment just a little too high for her to qualify.  This would have left her looking at a lower purchase price in order to qualify, had she not come to the right place! So instead of searching for a lower purchase price we looked into the USDA/RD loan for her.  Fortunately, the location was approved for USDA/RD loan and she also met the qualifications for the USDA/RD loan.  It was a great feeling helping her and her family get into the house they wanted and also saving her money on the monthly payment.

For many, homeownership can seem unattainable because they are unaware of the different opportunities and programs available to them.  The days of only 20% down to purchase a home are gone. A qualified lender will think outside the box and present your options, which actually may not be talked/blogged about, but have actually been around for a quite some time.

If you are wanting to purchase in a rural area and maybe are even unsure if it is an eligible area, then I highly suggest doing a little research and finding out if you qualify for a USDA loan.

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