$0 Down Home Loans
For many home buyers, saving the funds for a down payment is the largest obstacle to homeownership. Between monthly expenses, retirement funds and emergency funds, among others, being able to build the funds needed for a down payment ranging up to 20 percent can be nearly impossible.
Fortunately, the USDA Rural Housing Loan – or USDA Loan – allows homebuyers to purchase the home of their dreams without the need for a down payment, so that means no deposit required.
» More: Check Your USDA Loan Eligibility
The continuation of this incredible benefit is the result of USDA homebuyers partially funding the program through the USDA insurance fee. This mortgage insurance premium is similar to that of the FHA Loan, but is much less expensive.
The USDA charges 1% of the home’s price upfront (Guarantee Fee), which can be rolled into the entire loan amount, and an additional .35% annual fee of the principle per month over the life of the loan. Conversely, FHA Loans charge 1.75% upfront, and an additional .85% in mortgage insurance per month over the life of the loan.
To see the savings, let’s take a $100,000 mortgage and apply each. With the USDA Loan, a homebuyer would have to put ZERO MONEY DOWN and pay $1,000 upfront (which can be financed into the loan) and a additional .35% annual fee ($29.46 a month) over the life of the loan.
Now, with the FHA Loan, a borrower would have put 3.5% down ($3,500 dollars) and pay $1,688.75 upfront MIP (mortgage insurance premium), and a additional .85% MIP ($67.94 a month) over the life of the loan.
Does The Zero Down Loan Cover All States?
To determine which states and counties are covered under the zero down USDA home loan program, you should visit our maps pages. However, providing you are eligible to qualify for a loan and say for example you live in California, Texas or Florida, then you could potentially be able to get that amazing 100% no money down / no deposit USDA mortgage and set yourself up with exceptionally low interest rates from this popular government backed USDA Home Loan program.
Getting Started with a USDA Rural Development Home Loan
To get started with your USDA $0 down home loan, fill out our quick start form. After completing the Getting Started form, a USDA Loan expert will be in contact to help you take your first steps to becoming a homeowner.