How To Get A Mortgage Without A Down Payment

How To Get A Mortgage Without A Down Payment
How To Get A Mortgage Without A Down Payment

Video: How To Get A Mortgage Without A Down Payment

Video: How To Get A Mortgage Without A Down Payment
Video: 4 Ways to Buy a House With NO Money Down 2024, March
Anonim

Most young families are faced with the housing issue. But not every family can accumulate the necessary amount to purchase their own living space. Therefore, often the only possible option is a mortgage. However, most banks will not issue a mortgage if the borrower does not have the money to make a down payment.

How to get a mortgage without a down payment
How to get a mortgage without a down payment

Given the current rise in housing prices, even the minimum allowable down payment may turn out to be a tidy sum, which may take more than one year to accumulate. What to do if there is not enough money for the initial payment, but you want to buy a house right now? There are several solutions to this problem.

Option 1

The most obvious way to get a home loan without a down payment is to find a bank with an appropriate mortgage program. Despite the fact that such programs are quite risky for banks, such banks still exist. The disadvantage of this option is that the interest on the mortgage loan will be quite high, because banks seek to justify their risks.

Option 2

You can take out a consumer loan and use it as a down payment. The disadvantage of this option is obvious - for some time the borrower will have to repay two loans at once, so his income should be high enough. It should be borne in mind that the creditor bank will necessarily check the borrower's credit history and may reduce the desired amount of the mortgage loan due to the fact that he already has an outstanding loan.

Option 3

If the borrower already owns any real estate, then he can use it as additional collateral when registering a mortgage transaction. Thus, the bank receives a double guarantee of the fulfillment of obligations by the borrower, so the interest will not be overstated. However, it should be borne in mind that the mortgaged property must be profitable and located in the same region as the issuing bank.

Option 4

If the borrower has a certificate for receiving maternity capital, then the problem of the down payment is practically solved. This option is the most optimal in the absence of own savings, because the interest rate does not rise in this case. The only disadvantage of this option is that in order to use maternity capital as a down payment, it is necessary that at least 3 years have passed since the birth of the second child.

Thus, the situation when there is no money for a down payment on a mortgage is not entirely hopeless. And for some, one of the listed options can become a real solution to the housing problem.

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