You don’t have to be a first-time homebuyer in order to qualify for a low or no-down-payment mortgage when buying a home in the Lake Wallenpaupack area. Some low-down-payment loans assist buyers in economically disadvantaged areas, while VA loans cater to borrowers with military connections and USDA loans assist buyers in rural and suburban areas. Some conventional loans like the Home Possible®loan and the HomeReady™ mortgage have income limits rather than first-time homebuyer requirements.
A no down payment mortgage allows first-time home buyers, and repeat buyers, to purchase a home with no money required at closing except standard closing costs. USDA and VA government-backed loans allow you to purchase a home with zero down. The fact that these loans are backed by the federal government allows lenders to be more lenient with down payment requirements. To qualify for a USDA loan, you and your home must meet USDA loan standards, and to qualify for a VA loan, you must meet service standards.
If you are unable to meet the qualifications for either a USDA loan or a VA loan requiring no down payment, you may want to get a low down payment government-backed FHA loan or a conventional mortgage. You can get an FHA loan with as little as 3.5% down. Backed by the Federal Housing Administration, these loans are for people with low to moderate-income levels and have fewer requirements than USDA and VA loans.
USDA Rural Housing Loans
The USDA Rural Housing Loan is available to buyers in suburban neighborhoods as well as rural neighborhoods. The USDA’s goal is to reach low-to-moderate income homebuyers wherever they may be. Going one step further in helping prospective homebuyers, the USDA issues mortgages to applicants deemed to have the greatest need. That means an individual or family that is without “decent, safe, and sanitary housing, unable to secure a home loan from traditional sources and has an adjusted income at or below the low-income limit for the area where they live. The USDA usually issues direct loans for homes of 2,000 square feet or less, with a market value below the area loan limit. Many borrowers using the USDA Single Family Housing Guaranteed Loan Program make a good living and reside in neighborhoods that don’t meet the traditional definition of rural.
A VA loan is a $0 down mortgage option issued by private lenders and partially backed, or guaranteed, by the Department of Veterans Affairs (VA). Eligible borrowers can use a VA loan to purchase a property as their primary residence or refinance an existing mortgage. With a VA loan, eligible homebuyers are not required to have a down payment in most cases. There is also no monthly mortgage insurance premium to pay. The combination of no-down-payment and no mortgage insurance can save homebuyers, who qualify for a VA loan, a significant amount of money. VA loans continue to have the lowest average interest rates of all loan types and VA buyers can pay off a loan early without any financial penalties.
In order to qualify for an FHA loan, you must plan to live at the property you are purchasing as your primary residence. You must also buy a home that meets livability standards and move in within 60 days of closing. With a down payment of less than 10%, you are also required to pay mortgage insurance throughout the life of the loan. FHA loans are a great option for people with a low down payment and are also a viable option for those with a low credit score. In order to get an FHA loan combined with a lower down payment, you will need a credit score of at least 580. If your credit score is lower than 580, you’ll have to make up for it with a larger down payment. You may even be able to get a loan with a credit score as low as 500 points if you can bring a 10% down payment to closing.
In today’s market, conventional loans account for more than half of all mortgage loans made. By contrast, conventional loans are not backed by the government. Conventional loans are backed by Fannie Mae and Freddie Mac, and these two agencies exist solely to help banks make mortgage loans. They offer no mortgage insurance to lenders, leaving that task to private mortgage insurance (PMI) companies. If you have low to moderate-income compared to others in your area, you may want to consider a Home Possible®loan from Freddie Mac.
With this loan type, you are allowed to purchase a home with a 3% down payment and lower mortgage insurance options. In order to qualify, you can’t earn more than 100% of the median income in your area. Another 3% down payment option is the HomeReady™ mortgage backed by Fannie Mae. This loan type offers below-market mortgage rates, reduced mortgage insurance costs, and the income of everybody living in the home can be used to get mortgage-qualified and approved.
The good news is that there is a bevy of mortgage programs requiring little or no money down and they are available to the general public. Want to buy a home in the Lake Wallenpaupack area with low or no money down? Give top-rated Lake Wallenpaupack REALTOR® – Alicia Kowalik a call today!
Partner with Top-rated Lake Wallenpaupack REALTOR® – Alicia Kowalik
A highly-rated and experienced Lake Wallenpaupack REALTOR® like Alicia can show you more properties and save you thousands of dollars when buying a home. You need an agent who knows the Lake Wallenpaupack area, processes a vast network of local connections, and has the skills to negotiate like a pro. From first-time homebuyers to multi-million dollar investors, Alicia continually strives to provide top quality service for her clients. With access to the most up-to-date MLS listings for Lake Wallenpaupack properties, Alicia is able to match your lifestyle needs with the perfect home.
If you are ready to list your current property, Alicia has the experience and skills necessary to handle the sale and marketing of your home for the optimum results. She employs the latest technology to deliver maximum exposure for your property that will drive mega-response from buyers. With over 9 years of local real estate experience, Alicia is an agent you can count on. She will protect your interests, advocate for you, and go the extra mile to ensure a smooth and successful transaction.
Alicia Kowalik, REALTOR®
Lakeview Realty Inc.
2449 Route 6, Hawley, PA 18428
Direct: 570-470-5076 (Best)