By financen | November 6, 2010 - 12:16 pm - Posted in Mortgage, Mortgage loan

It was only a few years ago when someone could get zero down mortgage financing with sub 600 credit scores. Fast forward to 2010 and mortgage guidelines have become much more strict making 100% financing increasingly more difficult for most borrowers to obtain. Still, there are a few mortgage products in the marketplace that provide 96.5%-100% financing. The most popular of these products comes courtesy of the Federal Housing Administration (HUD). FHA mortgage products allow for home financing with as little as 3.5% down and can offer a higher cash-out equity threshold when compared with Fannie Mae and Freddie Mac agency products. And while FHA loans are far from the subprime products of the past, they do offer slighted more relaxed underwriting guidelines than many other mortgage programs out there. FHA loan can be used to finance 1-4 units primary residences and there are even FHA mobile home loans available.


The two most popular remaining 100% financing products are USDA rural housing loans and VA loans. VA loans are a zero down mortgage solution which are designed to help qualifying active duty servicemen and women, veterans, and surviving spouses purchase real estate with little to no money out of pocket. These are made available by approved lenders and are guaranteed by the United States Department of Veterans Affairs. USDA mortgages, administered by the United States Department of Agriculture Rural Development, are designed for lower income individuals who are looking to purchase properties in rural area of the United States. Eligibility is impacted by both a borrower’s income and the home itself. According the USDA’s web site, applicants can only earn up to 115% of the median income for their area. Loan programs are for 30 years and there is no down payment required. Borrowers can search for a property by its address on the USDA site to see if the home is in a USDA eligible area.


There may be some other low and no money down outlets available from local banks, credit unions, private investors, and state and local government agencies. Talk to a mortgage professional in your community to determine what products best meet your financial goals.