Ramon Estrel…, Other/Just Looking in 91915

what advice can you give to a first time buyers? who wants to buy a house with no down payment?

Asked by Ramon Estrella, 91915 Fri May 20, 2011

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62
Mack McCoy, Agent, Seattle, WA
Fri May 20, 2011
One thing I tell them, Ramon, is that they aren't really buyers, they're borrowers - so even more important than the home that they are going to borrow on, is the state of their own personal finances. It's one thing if they have money for a down payment but prefer to leverage, it's another thing if they have no money for a down payment, because that also means they have no money for emergencies.

Prices are good right now, and interest rates are exceptionally low, so it is a great time to borrow money. However, it's never a good time to be on the hook for a 30-year mortgage and not have any cash on hand to replace your car's transmission or cover the deductible on an insurance claim.

All the best,
2 votes
Cory La Scala, Agent, San Diego, CA
Fri May 20, 2011
Hi Ramon,

The short answer is that there really aren't any no down payment loans, except for VA loans, certain loans for homes owned by the VA, or USDA loans (for homes located in eligible rural areas). There may be other loans on certain eligible homes. There are still down payment assistance programs, but they're not always funded, and in a time when city, county, state and federal budgets are being slashed, it won't be easy.

Your best bet is to get online and research programs in your area, or to find homes owned by the VA or located in USDA areas, which I can help you with. Also, I can send you some lenders to talk to that have worked with these programs.

Remember that you'll also have closing costs, although you can ask a seller to pay them, or most of them. You'll also have to prove that you have the funds to close, so you should have some money in the bank. A lender that sees you have very little money in the bank may not see you as a good risk. You'll pay with a higher interest rate, which will make you qualify for less house, or you may be rejected for a loan altogether. They will verify at what your income is, what your expenses are, what your credit looks like, etc.

But, yes you can buy a home with no down payment, it just won't be easy, and you'll have competition. let me know if I can help get you started.

Regards,
Cory
2 votes
Kenneth Brit…, Agent, Columbus, OH
Tue Nov 8, 2011
When buying a home in a rural development, 100% financing is available through the USDA Rural Housing Financing. Work equity is another form of down payment, that's very popular when building a new home. Work equity can also be given as down payment on a existing home, but be sure your lender and realtor do there homework before requesting this in the purchase contract. In respect to credit inquires, you have soft or hard credit pulls, meaning it depend's on the inquiry. You have a certain amount of days to count the inquiry as 1 credit inquiry. All decisions should never be made without some education, professional advice and support from family members you trust. Credit is king in the financial market, get some credit education and take some home buying classes to strengthen your ability to make a good decision. Credit cards can be your friend or enemy in this process, make sure you keep the balances on the revolving debt below 35% of the high credit limit. In moving forward in the Real Estate market you will see some markets are appreciating, depreciating or flat. Educate yourself on why this happens in the area you are looking to buy. Once you are educated, now you can interview Real Estate Agents that should be more educated than you and expect them to provide you the service you require / deserve! The Fair Credit Reporting Act of 1971 may help to improve your credit score and secure your credit report with credit monitoring / Identity theft protection, see my Web Reference. The goal for all Americans should be to have a home PAID by retirement, part of your future and family success is riding on this decision!!
1 vote
Joy Bender, Agent, La Jolla, CA
Sun Oct 30, 2011
For San Diego county I have many references for down payment assistance in the different cities and counties http://www.sandiegodownpaymenthelp.com
1 vote
Marco Gomez &…, Agent, Jackson Heights, NY
Tue Oct 25, 2011
Currently the lowest down payment available is 3.5% down on an FHA loan. I would recommend you speak to a lender to make sure you meet the FHA guidelines, as they allow 3.5% down with up to a 6% seller concession, effectively making it close to zero down.


Regards,
Marco Gomez
Associate Broker
Keller Williams Landmark II
Queens, NY
1 vote
Robert Smith, , Bland, MO
Mon Oct 24, 2011
Just remember your first home should be a blessing and not a distraction. Are you sure you are ready for your first home, do you have funds available if something breaks, do you have enough to pay for taxes. Make sure your have enough of an emergency fund to help you out and you are able to repair things as they break. When you rent the landlord does most of this, owning your own home you have no one to turn to. So good luck with your first home purchase.
1 vote
Donna Baker, Agent, Monrovia, CA
Mon Oct 24, 2011
I agree with the consensus. Trying to buy a house with no down payment is not the best scenario, and may be impossible in today's lending arena. Part of the problem with the mortgage meltdown was lenders allowing borrowers to buy houses they couldn't afford with no down payment and not enough income to cover the payments, insurance and property taxes, let alone the day-to-day expenses associated with homeownership. Save your money. FHA loans only require 3.5% down. Set your sights on a price range you can afford and take advantage of the loans that will fit your lifestyle. Best of luck!
1 vote
Deborah Grif…, Agent, Scottsdale, AZ
Tue May 31, 2011
Ramon,

You need to wait to purchase if you do not have any money for the down payment. I would not purchase anything without having reserves as well as the down payment money. Buying a home is a lot of responsibility and you need to have money in the event a repair needs to be done. Wait…you will be glad you did.

Best of luck!
Deborah
1 vote
Don Tepper, Agent, Burke, VA
Sun May 29, 2011
If you WANT to buy a house with no down payment, then consider VA financing or creative financing (owner financing, lease-options, subject tos, and more).

If you HAVE to buy with no down payment, then I agree with the others. Save up some money. Build a nest egg. Have some cash for the tough times. See a financial planner, as John suggested.

Good luck.
1 vote
Tim Page, , 99037
Fri May 27, 2011
Don't do it. Not to hurt your feeling or anything, but if you don't have much cash, start saving. Look, there is a good chance that home prices will decrease even more and this will help your cause, as long as interest rates stay low. But the worst thing you can do is buy a home when you don't have the cash. There are lots of issues with FSBO sales and finding home owners to rent to own and other methods. One thing goes wrong and your out of money and on the street. Many of the refinances that I appraise is caused by the home owner running out of money. If you run out of money, the game is over. Good job, good saving account, next, buy a home.
1 vote
Carmen Brode…, Agent, Scottsdale, AZ
Thu May 26, 2011
This is about as rare as unicorns these days. Good luck finding financing.
1 vote
Kevin and Ju…, Agent, Wildomar, CA
Sun Nov 6, 2011
Best advise id to visit with the lending specialist at the bank/credit union where you have your checking account. They will have the info you need. As a side note, "no money down" deals are rare. There are some USDA loans available for 'rural' ares, but your best bet may be to save 3.5% of the purchase price and get an FHA loan.

Good Luck!
0 votes
Kim Ljungqui…, Agent, New Milford, CT
Sat Nov 5, 2011
I would advise you to see a morgage broker where you can give them more of your personal info lots of great programs out there.
0 votes
Kathy & Terry…, Agent, Charlotte, NC
Thu Nov 3, 2011
The first thing you need to do is to get pre-qualified with a lender you trust. They will run credit report and ask you personal questions about your financial situation to determine your next step in the process. Always make sure that you are confortable with the down payment that you would need in order to purchase your new home as well as the monthly mortgage payment and escrows you will have to have. When you are ready to get started your real estate broker can offer assistance in finding a lender you can trust.

Good Luck!
Kathy Huntley
Realtor/Broker
Charlotte, NC
0 votes
Richard Bre…, Agent, GREENWICH, CT
Wed Nov 2, 2011
My advice would be to start saving up for a 3.5% down payment. That's the least amount you could put down going FHA. if you could get a credit from the lender towards closing costs or get a seller concession from the seller you wouldn't need to come up with the closing costs. You will still need a little extra cash for appraisal.
0 votes
Alain Picard, Agent, Puyallup, WA
Wed Nov 2, 2011
Contact a local real estate agent or a local lender and ask them about it. For example I know a bank that is by my office that has 100% financing and you only need $500.00 down. There are also county programs that may offer down payment assistance.
0 votes
Courtney Edw…, Agent, Elk Grove, CA
Wed Nov 2, 2011
Your best bet would to contact a Real Estate Professional for that particular area,or mortgage broker/lender and go over what loan programs are available to that particular county in which you would live in .
Good luck in your search!!
0 votes
Steve Vennem…, Agent, Pine Springs, MN
Wed Nov 2, 2011
There isn't any programs out there any more who offer 100% financing- Unless you can get a 1st and 2nd mortgage that is the best way to do it.
0 votes
ROY Mason, Agent, SAN DIEGO, CA
Wed Nov 2, 2011
There are areas in San Diego County you can get a loan with no money down, theres also loans out there that you can get for a half percent down , 1% to 3.5% down, depending on what you want to buy it could equal to or be less than what it would cost to RENT a house when you ad up first, last security deposit . I recomend Talking to a loan officer that does FHA and RURAL financing , IF you dont know any I can help find you someone to help out. San Diego also has programs to help with the down payment
Call me

Roy 858-752-3523
0 votes
Mark Fleysher, Agent, Las Vegas, NV
Tue Nov 1, 2011
Hi Ramon,

There are very few to no lenders who will lend without a down payment or at least down payment assistance.

This can greatly vary on your area, so I would definitely contact multiple lenders to discuss your options.

Here in Las Vegas, you can buy a VERY nice home with very little down.

Sincerely,

Mark Fleysher

http://www.jackconleyrealty.com
0 votes
Natalie Thom…, Agent, Bronson, FL
Tue Nov 1, 2011
With regard to responses that imply you're not ready to be a homeowner because you don't have a down payment, I beg to differ. My advice for you is to find a reputable realtor that's educated in the variuos loan products that are available as well as down payment assitance programs to help direct you to the right lender.
I've been able to assist first time homebuyers achieve the American dream of home ownership for a total payment (principal, interest, taxes, and insurance) that's less than the amount of rent they are currently paying.
Why would you rent when you can buy for the same payment or less?
0 votes
Pauline Char…, Agent, Brentwood, TN
Tue Nov 1, 2011
Look for the down payment assistance programs in your area. Be sure you understand your responsibilities to read fine print and be clear on how the program works. Find a reputable down payment assistance program.The ideal situation is to have a small down payment but if you can see your way to make extra payments on the mortgage you obtain you can build equity while you are in the house. Think of it as putting money in your piggy bank. Your objective will be to pay off as much as you can as soon as you can in addition to the monthly mortgage payment. You may start out in the same position as renter but determination can build your equity.
0 votes
gabriel palo…, Agent, Pompano Beach, FL
Mon Oct 31, 2011
A simple answer that you may not appreciate. DON'T
What you are buying into is DEBT while establishing NO EQUITY
With those odds keep on renting and save and why pay for a mortgage, taxes, insurance, costly upkeep and repairs that comes with the responsibility of home ownership
The purpose of buying anything for nothing is why the risk out ways the gain and nothing buys nothing but trouble.
That answers why so many like you with the same game plan ended up with nothing but trouble.
Ramon,
have the good sense not to join them, trouble invites and loves company.
0 votes
Mikel DeFran…, Agent, Canton, MA
Sat Oct 29, 2011
Unless you want to seriously limit your choices or do backflips trying to qualify for a specialty program... save, or be gifted 3.5% or 5% downpayment and open up yourself to every home on the market, you will be glad you did.
0 votes
Raul Lozano, Agent, Ontario, CA
Sat Oct 29, 2011
Hi Ramon, the first step is get in touch with a local real estate agent so he/her together with a loan officer can let you know the programs available in your area.
Web Reference:  http://www.RaulLozano.com
0 votes
, ,
Fri Oct 28, 2011
Robin is giving you some good advice, the HUD homes is a bit dificult, in Southern CA, A lot of people bidding on them. Buying a home using the USDA is a lot easier, I don't do the USDA loan but highly recomend it as way to go if you can. It has to be a rural home, no farms. And finding one agent that will work hard for you is great advice.
My companies offers several programs like CalHFA where you get something like a 3% silent 2nd and need to come in with very little, if you would like to check into that let me know.
0 votes
Robin Ricker, Agent, Titusville, FL
Fri Oct 28, 2011
HUD homes are a great option, but the most forgotten loan is the USDA loan, if it is available for the area you are considering. It is for rural homes, but a great loan for lst time home buyers. You really need 1 agent working for you. Your realtor can locate the lender that could help you the most, then you would be ready to purchase the minute you find the home you wanted. Good luck!!
0 votes
Doug Lay, Agent, Branson, MO
Thu Oct 27, 2011
HUD has just approved a program to purchase HUD owned REO's for a $100 down payment. Financing must be FHA insured and can be used the FHA 203k loan which allows added financing to do repairs. Check with your financial institutions for details.
0 votes
Linda Schnei…, Agent, Estes Park, CO
Wed Oct 26, 2011
Contact a professoinal realtor in your area for recommendations on mortgage bankers and down payment assistance programs. Our community offers a program for 1st time home buyers.
0 votes
Joseph Hasti…, Agent, Bayside, NY
Wed Oct 26, 2011
Hi Ramon. While I'm not local to your area, your question compelled me to respond. I'll pay you the compliment of being direct. While I appreciate your want to own property, you offer absolutely no insight into your specific financial situation. The Trulia broker community has no idea of your income, assets or credit history or FICO score. Do you have a ton of debt? Car loans? Student loans? Personal loans? do you have a job? We have no idea.

Sure, you might be able to get owner financing and there are programs that you might qualify for. You may ultimately get into a property that you can't afford and shortly down the road may be in forclosure. I'll agree with Mack McCoy regarding leverage but, you do need to show some assets somewhere and credit worthiness. Here's my advise; Save your money, check you credit and clean it up if necessary. Prices will most likely be flat in your area for some time to come. Go to your bank and talk to their loan officer to see what you might qualify for right now. Good luck.
0 votes
, ,
Wed Oct 26, 2011
Jack is correct, there are several programs like this out there. Many times they are full of red tape, we have all of the programs except the USDA here where I work. But they can cause for a stressful transaction because you add a governmental agency into the transaction. But, that said, at least you can get it done, and the terms on these things are very good.
0 votes
Jack Meyers, Agent, Aurora, CO
Wed Oct 26, 2011
Another option is to start with a lender in your state who knows all the first time home buyer options. In Colorado here we have down payment assistance programs like CHAFA. This program gives the buyer 3% down for a home purchase. Some restrictions apply like income limits, but this is how I successfully get many first time home buyers in homes. Good luck!
0 votes
Charlene Pla…, Agent, Eugene, OR
Tue Oct 25, 2011
I agree with the others, you first need to contact a competent financial professional to see what price range you can even look in. A good mortgage broker can find you a very low rate. Here in Oregon we do USDA loans (zero down) on more rural properties. I can help you find someone if you want to contact me. I'm from North County and know a very good mortgage broker down there.
0 votes
, ,
Tue Oct 25, 2011
In CA you have a couple of very low down payment options like Ca HFA. They all have different requirements feel free to contact me to see is you qualify for any of them. We do not do the USDA laons which are great, but do offer most of the other programs.
0 votes
Derek Rotzin…, , San Diego, CA
Tue Oct 25, 2011
You either need to able to qualify for a VA loan, get an investor to help you with the down payment, or qualify for a grant. Try this website:

CHWorks.org

There are income requirements to qualify but this is a great way to get money for a home. I hope this helps.
0 votes
Greta Belser, , Birmingham, AL
Tue Oct 25, 2011
I would strongly recommend a meeting with a competent financial professional to assess exactly where you are to be sure that now is a good time for you to purchase a home. You want to be sure that you are not about to get in over your head financially, because purchasing a home is the largest investment you will likely make, therefore some actual out of pocket expenses are usually required. Be aware that little and no money down financing will likely lead to higher interest rates and less desireable terms.
0 votes
Jeff Sarault, Agent, Vancouver, WA
Mon Oct 24, 2011
I have had this question come up a lot in my neck of the woods. USDA is one option. They are a "rural" loan. You can not buy in city limits, but can buy in a more rural setting for zero money down. Check the USDA website for a map of qualifying areas and see if any are close to where you want to buy.
We also have a bond program with down payment assistance in WA state. You may have the same type of program in your state. Check with a local Real Estate professional and ask them about the USDA program, or any state bond program.
Before putting the cart before the horse though, check with a trusted mortgage professional and make sure you can afford the monthly payment including taxes, insurance, all utilities, and projected maintenance on any property you may be interested in.
0 votes
Felecia Hump…, Agent, Leesburg, FL
Mon Oct 24, 2011
Please contact a local real estate professional in your area. Their office usually works with a mortgage professional that can do magic,,,,,, Good luck and happy house hunting!
0 votes
Chad Bowers, , New Castle County, DE
Sun Oct 23, 2011
I suggest that you contact a local realtor or mortgage expert in your area as they should know what types of programs are available that allow buyer's to utilize any bond programs or state grants that assist with the down payments and closing costs.

Almost every state has a 1st time homebuyer bond program or housing finance agency that offers these programs. In Delaware we have DSHA(Delaware State Housing Authority) and they have a 1st time homebuyer program that allows the buyer to utilize a 2nd mortgage up to $10,000 to help with the down payment or closing costs. Hope that helps you!
0 votes
LUCIFER, , Cape Coral, FL
Sun Oct 23, 2011
Research EVERY grant available to first time buyers. Do not jump in and be really in debt. Borrowing from friends and family may turn into a big mistake. There are programs and grants out there. You have to research and ask other home owners questions. I ask everybody questions. It never hurts to ask. Good Luck
0 votes
Sharon Bradl…, Agent, Stroudsburg, PA
Sun Oct 23, 2011
Try borrowing from family or friends. If not than waiting would be the best until you are able to save and have some reserve funds.

Best of luck!
Sharon
0 votes
Gerald Hansl…, Both Buyer And Seller, Harrisburg, PA
Sun Oct 23, 2011
The most important advice I can think of is don't go over your head, start out with something you can afford and also portrays a certain amount of potential. If you are somewhat handy, even if it's only painting you could add value to your property. Small improvements add value to your property and someday if you decide to move up the property ladder you may be very happy with the results of your efforts.
0 votes
Terry Bell, Agent, Santa Rosa, CA
Sun Oct 23, 2011
In this day and age, you have to be a creative thinker to take advantage of low rates and low prices. Many people or families are going in together on deals to get in this market. You may have the good credit, but maybe someone else in your family has equity, or cash to go in with you on an investment! I recommend talking to friends and relatives that may also be interested in home owning, and then talk to some loan brokers who can pull your credit and give you some good advice of what exactly you need to bring into a deal cash-wise to make it happen! Although San Diego is one of the more expensive places to buy, you might consider looking for areas further east or south to get a better deal to qualify! Good Luck, Terry Bell, Realtor, Santa Rosa, CA
(if you liked my answer, please give me a thumbs up!)
0 votes
Deborah Garv…, Mortgage Broker Or Lender, San Diego, CA
Wed Jun 22, 2011
Ramon, I agree with comments that having savings and good reserves are tantamount to helping you successfully buy, and maintain, your home. However, I am going to stick to answering your question and save the counseling part of the home buying process for when you actually are actively ready to buy.

VA is, of course, an option. FHA will allow for 100% gift. There are some down payment assist programs in the San Deigo area; however, they are very restrictive and (in my experience) very few people fit the profile to qualify. The USDA loan is probably your best bet as it does allow for 100% financing. It is specifically for "rural" properties, but you would be surprized at how much of East San Diego County and South Riverside County fit the parameters of "rural" per USDA standards.

If you have solid , good credit and reasonable to low debt a professional mortgage consultant can work with you to provide the knowledge and process to help you buy a home in the shortest amount of time. If, however, you do not have stable employment, have sketchy credit and are living paycheck to paycheck I suggest you hold off even considering buying a home until you have savings and reserves.
0 votes
Gita Bantwal, Agent, Jamison, PA
Fri Jun 17, 2011
Others have given you enough advice. I would like to add that once you buy a home there are maintenance costs. If you have not been able to save now, do you expect to be able to save after you have monthly payments which might be more than the rent because the less money you put down, the higher the payments. Sit down with a lender and find out what additional costs are involved besides interest on your loan.Good luck.
Web Reference:  http://www.gitabantwal.com
0 votes
Gerard Carney, Agent, Spring Hill, FL
Fri Jun 17, 2011
No such beast today for a first time buyer, you can apply for an FHA loan with 3.5% down but there is no more get the world for nothing down. Look into some of the first time buyer down payment assistant programs, look into what the county you wish to buy into is offering!
0 votes
Tom and Joan…, Agent, Boston, MA
Thu Jun 16, 2011
Ramon:

My advice would be to wait until you have money to put down. I love working with first time home buyers and about 50% of my business is made up of buyers, but you don't want to get into trouble. You need to have a cushion in the bank for the what if's, you need to lower your payment, and you want to show the bank security. Best in your pursuit of being a home owner
0 votes
Stephanie Le…, Agent, Miami Lakes, FL
Fri Jun 10, 2011
If you have no money to put down then start saving if you want to buy a home.... In today's market it is unlikely to find any lender to loan you money without putting money down...

3.5% is not that much. On $100,000 it is only $3,500

My advice is SAVE SAVE SAVE..

.
0 votes
The Property…, , San Diego County, CA
Fri Jun 10, 2011
First, you can't buy a home anymore unless you put down at least 1%. Secondly, even if you could, DON"T DO IT! Save up, put down a reasonable amount, and be sure to get a fixed rate mortgage.

And as was already mentioned, housing prices have not bottomed out yet, so hold off on buying now.
0 votes
Dawn Lewis, Agent, San Diego, CA
Mon Jun 6, 2011
Ramon, Are you a Veteran or Active Duty Military?
0 votes
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