The idea of a home loan with no down-payment requirement causes consternation among some people, many of whom view that type of home financing as part of the bad lending practices that ended in a housing crisis and widespread foreclosures. Yet low-down-payment and no-down-payment loans have been available for a long time through the Veterans Affairs (VA) loan program and the Department of Agriculture's Rural Development programs. Down-payment assistance has been available continuously from government programs that enable borrowers to buy homes with almost no cash needed. Individual lenders also offer low- or no- down-payment programs to qualified buyers, who must meet strict guidelines for creditworthiness and the ability to repay the loan.
Most prospective homebuyers are aware of today's stricter lending standards, but they also face another challenge when it comes to buying a home: the need for down-payment funds. At the height of the housing boom, a variety of no-down-payment loans were available, but those types of loans are rare in today's tightened credit market. Members of the military may qualify for a Veterans Affairs (VA) mortgage, which does not require a down payment, and zero-down- payment loans are available through the Department of Agriculture's (USDA) Rural Development housing program, although those mortgages are restricted by the location of the property and the income of the borrowers.
Potential homebuyers eager to take advantage of today's low mortgage rates and relatively more affordable home prices sometimes are stymied by the prospect of accumulating a substantial down payment. While Federal Housing Administration (FHA) loans are available with a down payment of 3.5 percent, those loans require both upfront and annual mortgage insurance payments. Conventional mortgage loans require private mortgage insurance (PMI) on loans with a down payment of less than 20 percent, but in some cases, the PMI payments along with the principal-and-interest payments will be lower than payments on an FHA loan of the same size.
DEAR BENNY: My husband and I recently filed for bankruptcy after our home was foreclosed. My mother is willing to purchase a home in her name (as an investment property) and rent it back to us, as long as we can come up with the down payment for her purchase. My in- laws have agreed to provide the down payment. The terms of the investment loan does not allow the down payment to come from a third party, so the money needs to be "gifted" to my mother. Essentially, we would be renting the property back from her. Would there be tax implications to her? Could my husband and I get the tax credit for the mortgage interest and property taxes? - Heidi
Congress on Tuesday revoked the first significant parts of President Obama's health care initiative when the Senate voted overwhelmingly to eliminate a burdensome tax paperwork requirement the law imposes on businesses. Republicans called the bill "a down payment on total repeal" while most Democrats said it marked an improvement in last year's law. The bill had previously cleared the House and now goes directly to Mr. Obama.
ALBANY - Gov. Andrew M. Cuomo, quashing concerns that state financial problems will undermine his $1 billion job-creation pledge for Western New York, today will unveil plans for a down payment involving efforts to bring next-generation private research and development companies to Buffalo. The plan will include a state investment in high-technology biomedical equipment in return for a commitment from a private company to locate in Western New York. Officials declined to provide the funding level or to name the company, but speculation was all over the board among local officials Monday.
How Obama Can Fulfill Pledge to Make Coastal Louisiana Better Than It Was Before Spill WASHINGTON, July 28 /PRNewswire-USNewswire/ -- A new report released today on the 100th day of the BP oil disaster details short- and long-term strategies for the Obama administration to make coastal Louisiana less vulnerable to future oil spills and hurricanes, including negotiating with BP for a $5 billion down payment on expected payments for natural resource damages. The report by Environmental Defense Fund, National Audubon Society and the National Wildlife Federation, "Common Ground: A Shared Vision for Restoring the Mississippi River Delta," outlines the necessary steps to restore and rebuild an ecosystem that has lost more than 2,300 square miles of wetlands--an area larger than the state of D...
WITH THE "FISCAL CLIFF" looming and no "grand bargain" in sight, talk in Washington has turned to a "down payment" - a package of spending cuts and revenue increases that would help us avoid the cliff and give leaders more time to strike a long-term deal. House Speaker John Boehner says such a mini-deal would serve as "a down payment on - and a catalyst for - major solutions, enacted in 2013, that begin to solve the problem.
YAKIMA, Wash. -- Given a boost by U.S. Interior Secretary Ken Salazar's visit last month, a wide-ranging group representing basin water interests agreed Wednesday to ask for $20.8 million as a down payment to meet future water needs. The money, a larger amount than what a subcommittee had initially recommended, will be sought through a combination of state and federal funds. The aim is to begin tackling storage, fish passage, land protection and habitat improvement projects -- all of which carry an ultimate price tag of about $5 billion.
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