How to Buy Homes with a No Money Down System

It is important to find a house that qualifies for a no-money-down loan.

A borrower is faced with the concern of finding the cash for a down payment and closing costs when buying a home. However, there is a way for a borrower to obtain a no-money-down loan that lowers his out-of-pocket cost. While it is more difficult now than it used to be, a no-money-down mortgage is possible when you have a strong employment history and a high credit rating. However, the borrower may pay more for a no-money-down loan in the long run, considering a lender generally requires private mortgage insurance with a zero-down loan.

Things You'll Need

• Credit report
• Purchase agreement
• Application
• Loan documents

Instructions

1. Visit one of the free credit report websites and print a copy of your current credit report. Use the drop--down menu to choose your sate. Supply the site with your personal information and choose any of the three reporting agencies listed.

2. Review your report by printing it and making sure there are no errors. Contact the reporting agency if you find any errors. It is important to clear any discrepancies and have the highest score possible on your credit report before obtaining a no-money-down loan.

3. Contact a mortgage broker in your area. A mortgage broker is able to provider several lenders with your information and secure a no-money-down loan for you if you have a strong credit and employment history.

4. Visit a local, privately-owned bank for a no-money-down loan. A bank that is privately owned has the ability to approve loans without an underwriter; making is possible to get a no-money-down loan.

5. Write a purchase agreement for the property you are purchasing. Request that the seller pays all closing and down payment costs for the buyer. As long as the lender is aware of the agreement, the costs may be "rolled-in" to the purchase amount. This provides you with a no-money-down loan.

6. Complete the loan process by providing the lender with a copy of the purchase agreement, a completed application, loan documents and any other requirements.

References

• Annual Credit Report: Free Credit Report
• Bankrate: 4 Mortgages that Require Little Money Down
• Bankrate: What is Mortgage Insurance?