How to Purchase Bank Foreclosures with No Money Down
Without enough money saved for the down payment on a home, many people feel they have no other choice but to keep on renting. Purchasing a bank foreclosure is one solution. Lenders, eager to get a property off their hands, offer options for purchasing bank foreclosures with no money down.
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Instructions
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Get a Federal Housing Administration loan. If this will be your first mortgage, you might be able to buy the foreclosed home with no down payment by getting 100 percent financing. You'll have to use a Federal Housing Administration loan in combination with another specialized first-time home buyer loan program. Search for a Federal Housing Administration lender on the U.S. Department of Housing and Urban Development: Lender List. Then go to the U.S. Department of Housing and Urban Development: Local Home Buying Programs to find a program in your state that will help you with the down payment.
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Get a loan from the bank. If you have good credit, banks may lend you the full price of the home loan or down payment, according to Bankrate.com. Go to your local bank and talk with a loan officer to see if you qualify. It's also possible that the lender holding a mortgage in default may give you a break on the down payment, according to Bankrate.
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Take out a line of credit. If you currently own your own home and you have a large amount of equity in it, you might be able to get a line of credit from your bank to buy a foreclosure. According to RealtyTrac, when foreclosure investors convert the line of credit into a mortgage, no down payment may be required. The line of credit pays for everything and no money comes out of your pocket.
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- Photo Credit new home 4 image by Kathy Burns from Fotolia.com
