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3 years ago
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what are the cons of getting a home @ no money down?

My husband and I are searching to buy a home. we are both 26 years old and it would be our first home. We dont have any money saved and are starting to save now. ive heard of no money down homes what are the pros or cons? what about the first home buyers program...what is a requirement to buy a home? I guess i might have to sit down with a realtor. we are just sooo tired of paying rent and have to small children that want there own room...anyy suggestions or advise to us looking AND WEIGHING options kinda lost..We are looking for a small good starter home like maybe a bungalow!! Also if you know of a good realtor please give me his/her number. Thanks God Bless
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2 years ago
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find a local realtor that knows about bond issues and charities that take donations for down payments... people donate money for write offs and then the charity pays your down...most realtors aren't active enough to know about these programs
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Mark Larson
Real Estate Professional
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2 years ago
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these are often through your employer or other nonprofit you need to be a member of in order to have access to. Down payment assistance in my area (Lake County IL.) is mainly from the city or county in some form of forgivable loan. these dry up as the programs are normally yearly and by mid to late summer are out of funds.

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2 years ago
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Thank you for your interesting response. I will try to locate someone. In the meantime, if you know of any realtor or organization(s)that might be willing to donate, please share that information with me at: Savednsingle@yahoo.com or 216-486-5140 (Regina). Again, thank you.

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2 years ago
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The problem with NO Money down is you end up paying PMI (private mortgage insurance) which is essentially an ADDED Insurance to protect the bank because you do not have 20% invested into your home. Do not confuse PMI with home owners insurance. My advise, speaking from experience, DON'T BUY w/out money down. My husband & I purchased our home for $244K which was the average price of homes in 2007 with no money down and are paying $196/month for PMI which is ADDED to our mortgage payment. We are stuck paying PMI ($196) until we have paid 20% into our home, basically that is money down the drain. We completely regret purchasing with 0 down. Apply for grants if or gifts if at all possible.

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Jim Cacioppo
Jim Cacioppo
Real Estate Professional
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2 years ago
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Hello I am a local Buyer's Agent who has taken classes regarding no money down programs and assist several first time buyers each year! If you haven't gotten the answers you've been looking for then please contact me directly.

Tammy Washer, Broker Associate
Grand Realty Group, Inc.
847-414-5490 cell
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susan smith
susan smith
Browsing Housing
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2 years ago
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Hi my name is Susan Smith I'm a grandmother rasing one of my g-childerend who is 8yrs of age. We're in need of someone to help us in locating a no money down programs or one of the charities that help with the down payments. If you can help we would be very thankful, maybe even helping us in getting into the home all together... Will be waiting to hear from you. Thank-u, Sue Smith 530-645-7361 email:mybigbunch1@yahoo.com

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Dario Kerkez
Dario Kerkez
Rental Housing Professional
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1 year ago
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Just reading these comments and can't believe it. This is a time nobody can rely on the banks. Forget about the brokers and agents in today's economy and prices, you should get more creative. Your best bet is to find and go directly to those that must sell but can't under this prices, or they just got inheritance and want to sell, for sale by owner, old people that need money for medical bills, Take their price but your terms. For example if the value of the property is 60,000 and they want 100,000 offer them 300$ for 30 yrs or play around with numbers. Let them be the bank and hold the note, or just take over their mortgage and move in on a lease .... What are they going to do with the money anyway put it in the bank for 0% interest. Remember there are a ton of desperate people that need help and that want to sell but can't, be a solution provider for them and get yourself a good deal.

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Bill Nelson
Browsing Housing
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2 years ago
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I'm not sure if the area you are looking for would qualify, but ask a lender in your area about the USDA loan program. The home must be in an area that qualifies and your income must meet their criteria (easier than you might think). The program allows you to buy with 0% down AND has no mortgage insurance requirement (Saves you $$$ over an FHA & VA Loans and adds to your buying power!). Overall, its a great program that many Realtors and Mortgage reps don't know about.
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2 years ago
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I qualify for a VA Loan and was wondering if the mortage insurance would be added to the loan if I don't do a down?

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JCP
Landlord
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2 years ago
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So you started saving now? Good. Don't stop! : )

A lease option might be another possibility for you. It's a rent-to-own type of transaction between buyer and seller. There are pros and cons to an option, but sellers are often more negotiable than banks, and it might be workable for you. Just do lots and lots of research.

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Mark Larson
Real Estate Professional
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2 years ago
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I'm a Realtor North of Chicago Servicing mainly Lake county at the time. I would agree a local realtor will be the best choice as a buyer's agents almost always cost you nothing. Look for one in the area you want to live in as they will be most knowledgeable as the quick answer, the cons are a higher mortgage payment and a harder time getting a mortgage. Unless your credit score is really high like 780 or better you probably will not be able to get a zero down mortgage. Another person mentioned becoming getting down payment assistance and that might be available to you but it depends on the current programs available to you when you take out a mortgage or close on the property. A realtor with a ABR designation (accredited Buyer's representative) will know most of those in the county they specialize in.

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Mike Schneider
Mike Schneider
Real Estate Professional
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2 years ago
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Today, the only "Zero Down" im aware of is a "VA" loan...The remainder 3% or more depending on your credit profile. There are 3% conventionals..more common 3.5%, 5%, 10%, 20% down...Im sure there are creative plans...but be aware! If it's cheap up front, they may get ya..at the end. Shop around ! best of Luck !
Mike Schneider, ABR, CDPE, SFR
Brokerocity.com
mike@brokerocity.com

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Stephen  Missirlian
Stephen Missirlian
Rental Housing Professional
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2 years ago
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The pros are just that, you are not putting any money down so you can use that extra cash for improvements to the home, other investments, etc. The biggest con is that the mortgage rate will be higher then if you put down 20 or even 10 percent.

Steve Missirlian
Chicago Apartment Seekers

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2 years ago
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don't do it! No $ down gets you PMI lots of $ for nothing-save some money for a down payment, prices aren't great now and won't be for a while- it's like having high rent-you need homeowners insurance, taxes and PMI you are not gaining equity in your purchase- you could be losing money. Do you really want a small bungalow? In the past-that bungalow would gain equity and you could move up to the bigger house-but not now-you might own that starter home forever.....

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2 years ago
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Due to the economy it will be difficult to find a mortgage with 0 down. Most now require 20% down.
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2 years ago
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Actually Kim, that is a myth. There are any number of programs that require 0% down such as USDA loans and FHA loans require 3.5% down. Even conventional loans usually do not require 20% anymore.

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Christen Cox
Real Estate Professional
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2 years ago
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That's actually not entirely true. A good Realtor will know of all of the programs available for first time home buyers to get the best deal on the purchase of their home. Some places have Grant and Bond programs that offer Down Payment Assistance and Closing Cost Assistance. Even if someone is not a first time buyer, they can get into a home for as little as 3.5% with a Conventional or FHA loan. I would be happy to refer anyone interested to a good Realtor anywhere in the country, as I am a Realtor with Keller Williams and we are everywhere!

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2 years ago
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Try a FHA loan or Rural Development loan I believe it was the FHA that has no PMI and no money down... But def. try more then one place for a loan.

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Cathy Hue
Browsing Housing
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1 year ago
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I think you should try for some thing called, rent to own, which will enable you to accumulate enough down payment and make your credit rating healthier to become equipped to buy a house. Read more about rent to own here, http://www.homestarsearch.com/rent-to-own-introduction

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2 years ago
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I am a buyers' agent and work with a great lender that has a phenomenal program for first time buyers and also provides downpayment assistance. Please go go my website www.ChicagoAreaHomeFinder.com, register and don't forget to ask for a preapproval.

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2 years ago
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can i get the icon too

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2 years ago
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My wife and I recently purchased a 1 family home with no down payment, but we do have excellent credit, you can contact your a realtor or contact my realtor, www.massada.com

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1 year ago
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I recently bought my home in a rural area and using a usda home loan, I had a hard time saving because of rent , I saved $1500 and qualified for my home, monthly paynents include hoa, home owners ins for 636, and pay half payments every 2 weeks to pay off faster, academy mortage can help and it helps to have a fico score higher than 640, I bought a flip house and love it..

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Cathy Hue
Browsing Housing
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1 year ago
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One of the most effective and popular methods to get hold of a house with out looking at your credit score and cash reserves as you would not need huge amount of money but enough money to pay for the option and earn enough to pay for the monthly rental.
Con here is that you can be conned by a seller with bad intentions. So kindly read agreement again and again before you start with it.
http://www.homestarsearch.com/rent-to-own-introduction/cost-of-rent-to-own

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