How To Buy Zero Down Homes

If you are wondering where to buy zero down homes, the answer is to look in a rural area. Pretty much every single family rural home will qualify for you to buy with zero down.

The reason you want to buy zero down homes in a rural area is so you can take advantage of the USDA Rural Development loan. This is a great loan as it does not require any down payment and it is a regular plain vanilla 30 year fixed mortgage.

So what is considered rural? Anywhere the USDA says is rural. There are no hard and true rules as to what is rural. Except the fact that if you want to buy a home in a large metropolitan area this loan will not allow you to do it.

At the same time a rural home does not have to be out in the middle of nowhere 50 miles from the closest town. In fact most small towns and cities qualify for this program.

If living in a rural area does not bother you. Then using the USDA Rural Development loan is the best way to buy zero down homes. This home loan comes with several great features.

First and the most obvious is that you can buy with zero down.

Second, you can have the seller pay all of your closing costs. In other words you can save yourself $5,000 to $8,000 when utilizing this loan.

Third, you can actually finance your closing costs, if the seller will not pay for them. This is only allowed if the home appraises for more than what you are buying it for. You are limited to $10,000 when financing your fees. If your fees are more than this, which would be rare, you will need to pay for the difference.

Finally, you can finance up to $10,000 worth of repairs into your loan. Again you can only do this if the home appraises for more than what you are purchasing it for. With this feature you are still limited to the $10,000. If there is more than $10,000 in repairs the home will most likely not be financeable.

If you don’t care about owning a rural home or were already looking to buy zero down homes in a rural area. Then you really need to consider the USDA Rural Development loan.