Key takeaways
- VA and USDA loans offer no-down-payment options for eligible borrowers.
- FHA loans and several conventional programs are built for buyers with a smaller down payment.
- Gift funds from family can cover your down payment with proper documentation.
- Down payment assistance programs may be available depending on your area and income.
One of the biggest myths in home buying is that you need a huge down payment. For most buyers today, that's simply not true. There are programs that require very little, or nothing at all, up front.
Zero-down-payment options
VA loans
For eligible veterans, active-duty service members, and some surviving spouses. VA loans offer no down payment, and no monthly mortgage insurance. As a Navy veteran myself, this is one of my favorite programs to help with. VA loans can also be used to refinance.
USDA loans
Designed for homes in eligible rural and some suburban areas. USDA loans require no down payment but have household income limits and property location requirements.
Low-down-payment options
FHA loans
FHA loans are designed for buyers with a smaller down payment and are known for flexible credit guidelines, making them a great fit for first-time buyers and borrowers rebuilding credit.
Conventional low-down-payment programs
Fannie Mae and Freddie Mac programs such as HomeReady, Home Possible and similar low-down-payment programs are designed for buyers with a smaller down payment. Mortgage insurance usually applies when you put down less than a full 20%, and it can be removed later as you build equity.
Other ways to cover the down payment
- Gift funds. Family members can gift money toward your down payment, documented with a signed gift letter.
- Down payment assistance (DPA). State and local programs in California, Florida, and Washington may offer grants or second loans to help with down payment and closing costs.
- Seller concessions. In some deals, the seller can contribute toward your closing costs.
Which option is right for you?
It depends on your eligibility, credit, income, and where you're buying. We'll compare the options side by side so you can see the real monthly payment and cash needed to close for each.
Frequently asked questions
Can I buy a house with no money down?
Yes, if you qualify for a VA loan (veterans and service members) or a USDA loan (eligible rural and suburban areas). Both offer no-down-payment options. You'll still have closing costs, which can sometimes be covered by seller concessions or assistance programs.
Is an FHA loan good for buyers with a small down payment?
Yes. FHA loans are designed for buyers with a smaller down payment and more flexible credit. The required down payment depends on your credit score, so ask us for the exact figures for your situation.
Can I use gift money for a down payment?
Yes. Most loan programs allow gift funds from family members, documented with a gift letter confirming the money doesn't need to be repaid.
Have questions about your situation?
Talk with a licensed loan originator. We'll walk you through your options in plain language.
Apply NowCall 855-724-5626This article is for general educational purposes and is not a commitment to lend. Loan programs, guidelines, and eligibility vary by lender and are subject to change. Contact us for advice on your specific situation.