5 Zero or Low Down Payment Mortgage Programs
RALEIGH, NC – Buying a home can be one of the most rewarding yet complicated endeavors that an average, person will undergo in their life. New government regulations makes an already complicated project even more challenging. Down and debt payment is often cited as one of the biggest barriers to home-ownership faced by millennials today. Debt continues to be a serious problem with millennials, specifically student loan debt. Truth be told there is no quick and easy way to solve debt problems. It takes time and commitment to than simply borrowing and spending less than you earn.
There are several government backed loan programs as well as niche loans from banks and credit unions for first time home buyers that help qualified buyers to buy their primary home with little or no down payment! Here are 6 loan programs that allow you to purchase a home with zero or low down-payment in Raleigh and Wake County of North Carolina.
#1 USDA – Guaranteed Rural Development Loan
Properties must be located within a USDA eligible area. Must be ‘moderately priced’. They must be in good condition with no deferred maintenance. Qualified applicants must have a reasonable credit history free from foreclosures or charge offs in the past 7 years. However, in some cases a short-sale that is at least three years old will not prevent someone from obtaining a USDA loan. Applicants must be able to demonstrate stability of income for the past two years and should have a reasonable pattern of established savings. Debt to Income Ratios should not exceed 29% for total monthly payment (PITI) and total debt servicing of 43%. Household income is determined by County limits. Wake County income limits for a family of four in 2015 is limited to $91,850 for a family of 4 and $121,250 for a family of five. Meanwhile in Durham and Chapel Hill the income limits for a family of four in 2015 is limited to $82,000 for a family of 4 and $108,250 for a family of five. USDA Guaranteed Rural Development Loans require no down payment. Loans in North Carolina are limited to $417,000 and may be up to 100% of the appraised value.. All properties must be owner-occupied. Only primary residences are permitted. Credit scores of at least 580 is required and the lender will use the middle of the three scores. Credit scores less than 640 will be evaluated for credit worthiness and may require additional documentation.
#2 VA Loan
this loan is limited to eligible members of the armed services both active and separated. Credit must be reasonable and must be no lower than 580. Eligible veterans must be able to demonstrate sufficient disposable income and must not have a debt to income ratio that exceeds 45%. Loans for home in North Carolina up to $417,000 do not require a down payment, however loans greater than $417,000 will require a small down payment. Eligible veterans will need to be able to produce a DD-214 in order to request a Certificate of Eligibility. All properties must be owner-occupied. Only primary residences are permitted.