Buying a home might seem out of your reach. House prices are high in many areas and you might feel your income could keep you from ever owning a home. It is possible to buy a home without a down payment or perhaps a smaller one than you might think.
While it's possible that your mortgage payment will be higher if you don't have a down payment, here are a few ways to buy a home if you have no or very little money to put down.
Rent To Own Homes
Rent to own homes have become somewhat popular over the past few years. They make homeownership more affordable because you don't need to put a down payment on the house in order to buy it. Instead, rent to own homes are a unique path to homeownership.
You start out by renting the house, but instead of that rent going to the owner and you never seeing it again, that rent goes toward the down payment of the house. There is usually a term length of how long you will rent the home before the down payment has been paid off and your payments will convert to mortgage payments.
Interest on these homes can be high, but if you don't have any other means of obtaining a down payment, it could be something worth checking out.
There are some government loans you might be able to apply for to help cover a down payment on a house. For example, the Veterans Affairs loan is open to active and retired military members. There is an interest rate you must pay, but it is usually lower than a traditional mortgage. You don't need a down payment to get it but there are some guidelines you must follow.
You also could contact the United States Department of Agriculture, or USDA, for a loan. If you live in a rural area or plan to move there, these loans could help you buy a house with no money down. You have to meet the income standard for your state and the area must be deemed rural for your state as well.
The Federal Housing Administration or FHA loan is an option too. You will most likely need at least a small down payment for the house but it's usually lower than traditional amounts. You will need a moderate credit score or higher to qualify too.
Contact a local real estate agent for more information buying property.