By CADENCE BANK
For potential homebuyers, coming up with a large down payment and the added expense of private mortgage insurance (PMI) – which protects the lender from default – can be a daunting task.
The good news is a significant down payment might not be necessary to buy a home. Some mortgages are even available with zero percent down payment for homebuyers who qualify. These are referred to as 100 percent financing loans. Additionally, there are programs that exclude the PMI requirement.
Consider these tips to obtain a mortgage with a smaller down payment:
- Check into low down payment loans offered by the Federal Housing Administration (FHA). FHA home loans are the most common type of low down payment loans. Instead of loaning money, FHA insures private lender loans by commercial banks, and each lender sets their own rate and term.
- If buying in a rural area and household income meets certain requirements, you may qualify for a mortgage loan offering 100 percent financing.This program is sponsored by the U.S. Department of Agriculture (USDA).
- Served in the military? Veterans can qualify for low or no down payment loans without the PMI requirement.The U.S. Department of Veterans Affairs (VA) guarantees loans made by private lenders for military veterans, active duty military, reservists and spouses of deceased military who have not remarried.
- Reap the rewards of good credit. Conventional home loans can sometimes be made with a low down payment for homebuyers who meet the bank’s qualification criteria.A relatively high credit score and stable job history are keys to eligibility for these types of loans.
- Explore Cadence Bank’s Affordable Home Loan Program. Cadence offers a low or no down payment mortgage loan designed to help low- and moderate-income borrowers for whom it is difficult to save a large down payment. The Cadence Bank Affordable Home Loan Program offers up to 100 percent financing for borrowers who qualify, with no PMI requirement or loan origination fee.
Visit Cadence Bank atwww.cadencehomeloans.comto learn more about low or no down payment mortgage loan options.
Cadence Bank, N.A. Member FDIC Equal Housing Lender NMLS#525022