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Camanche : Real Estate Advice

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Mon Oct 17, 2016
Sally Grenier answered:
No, you cannot roll down payment into the loan. What you're talking about is a "zero down" loan situation which isn't very common. There are a few loan programs you can look into -- i.e VA loans offer a zero down option but you have to be a vet. USDA has a zero down program, but that's for rural areas. Typically, first time buyers are looking at an FHA loan which has a minimum of 3.5% down. There are some conventional loans that can do as little as 3% or 5%. Some states do have down payment assistance programs that are basically a 2nd mortgage.

BUT....here's my soapbox speech about having no down payment. Buying a home, owning a home and maintaining a home costs MONEY. On top of downpayment, you'll need closing costs (which can run 2-3% of the purchase price). Sometimes you can negotiate the seller to pay all or part of that. (Depending on the market you're in.) In a seller's market that is not likely.

But even if you can get them to do that, you still need earnest money (basically a deposit that shows you're a serious buyer, that is held by the title company at the time you make an offer). This gets applied to down payment or closing costs. If you're able to get away with no down payment and get seller to pay closing costs, then your EM gets refunded back to you at closing.

But even on top of that...you have inspection fees, appraisal fees, radon & mold test, termite inspection.... Then after you own the home, what happens if the furnace dies this winter? Or you have a roof leak? Or your pipes freeze?

The very first place to start would be to sit down with a local lender who can tell you what your loan options are. Then find a great Realtor who can walk you through the process. Good luck!
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Tue Jul 5, 2011
answered:
Jennifer - yes it is certainly possible, as Camanche, IA is an eligible area for USDA rural development financing.

Get in touch with Brian who responded to your question and he'll be able to get you on the road to determining USDA would be a possibility for you. We also do USDA financing for homes in Iowa, but I am not located in Iowa.

If you wanted to do a little research on your own first, you can go to http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do to see if your household income is within limits (which $700/every 2 weeks certainly would be) as well as where you are looking to buy would be an eligible area, which if you go too far north from Camanche, into the Clinton area, it becomes an ineligible area.

Your income level probably will also qualify you for special down payment assistance programs - such as the Iowa Housing Authority, which can help out with down payment & closing costs. http://www.iowafinanceauthority.gov/en/other_information/ifa_programs/ is the link for those programs.
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