Judy Lindsay Team Realty

How to Buy a Home with Little or No Money Down

Many people never buy the home of their dreams simply because they don’t think they have enough money for the down payment. They’ve been told through the years that they need 10 or 20 percent of the purchase price in order to buy a home. Well, this simply isn’t true.

So why have so many real estate companies told them this?

Quite honestly, it’s because selling homes to people with 10 or 20 percent down is easier than selling homes to people who have little or no money for a down payment. Most real estate sales people would rather go after the "easy sale" than try to help people who have special needs.

Option 1: Special Loan Programs

Special loan programs come and go quickly. There is program right now that actually gives you money on closing! Wow! That’s better than "no money down!!"

So, how do you find out what type of loan programs are available for you right now? The best way is to work with a great mortgage broker who keeps up to speed on these special programs. If you don’t know of one, we work with such mortgage professionals and we would be happy to refer you to one of them, depending on your particular needs.

Option 2: Owner Financing

Owner financing means exactly that: the owner (or seller) finances a portion of your home purchase. For example, you might borrow 80% of the value of a home from a lending institution, and "borrow" the other 20% from the owner. In this situation, the owner "carries back" a second mortgage.

Owner financing can be advantageous, especially to investors who buy up properties and then rent them out. For the average homebuyer, however, owner financing is difficult to find and requires some tricky negotiating. Even after successfully negotiating a deal, it requires some detailed work by qualified attorneys in order to protect the interests of all parties involved.

While you shouldn’t rule out owner financing, keep in mind that by looking for someone who is willing to help finance your purchase, you severely limit your choices. There are a lot of houses for sale today, but not a lot where owner financing is an option.

Option 3: Lease-To-Own

With a lease-to-own, you essentially lease a home, but make larger payments in order to begin accumulating a down payment. For example, if a house would normally lease for $800, you might lease it for $1,000/month, with $200/month going into a special account. At the end of a specified period, you buy the home using the money in that special account as your down payment. However, if you decide somewhere along the line not to purchase the home, all of the money in the special account then goes to the seller.

Think of this option as renting with a forced savings account. If you can find someone willing to do this, it’s not a bad option. However, most people who are selling their homes need their money out of it in order to buy their next home, so finding someone who is willing to lease to you may prove more difficult.

These are only 3 ways to buy no money down, contact us today and our buyer specialist can explain even more ways.

Where To Begin

Now that you have 3 good options for buying a home for little or no money down, where is the best place to begin?

The first step is get pre-qualified. And the best way to get pre-qualified is to find a real estate professional who is dedicated to helping people like you get into the home of your dreams.

We’ll do more than help you get financed!

Financing is only the first step in the home-buying process. We are dedicated to helping you through the entire process, delivering world-class service all along the way. We can help you find the right home, negotiate the right terms, and then make sure that you actually get to the closing table. It’s all part of our Preferred Buyer’s Program, which you can join for FREE! That’s right, it won’t cost you a dime, because all of our fees are paid by the seller!

For more details on How to Buy a Home with Little or “No Money Down”, please make a request.