A common misconception is that you need 20% down in order to qualify for a home mortgage. In fact, there are a few options out there that offer 100% mortgage financing.
Even if you don’t meet the eligibility requirements of 100% financing, there are additional mortgage loan programs that may suit your needs. Consider a conventional loan or a FHA loan, both of which can offer you the opportunity to owning a home but both require mortgage insurance.
In this mortgage guide, you will learn about three 100% financing loan programs available in Utah. All programs require eligibility, please get in touch with me to discuss the loan program(s) that interest you and I’ll review your borrower profile to see if you would be a good fit.
VA Home Loan – 100% Financing
The VA home loan is arguably the best mortgage product on the market today. This type of home loan is only available to eligible veterans and active duty service members of the U.S. military.
The Veteran’s Administration backs these mortgage loans so that lenders like Veritas Funding can offer more lenient guidelines to veterans. With the backing, private lenders can make loans per VA guidelines, without some of the requirements of other loan programs.
Here’s some of the basics of the Utah VA home loan program that offers 100% financing:
- No down payment required
- No monthly mortgage insurance
- Lower closing costs
- The seller can pay for all closing costs in most cases
- Lenient credit guidelines
If you are interested in applying for this program including finding out if this loan program is available to you, I will need your DD-214 report of separation from military service. I’ll need this form to obtain your Certificate of Eligibility. If you don’t have your DD-214, please request it from the National Personnel Records Center (NPRC).
To Learn More About VA Home Loans: Utah Veterans Affairs Home Mortgage
USDA Rural Loan – 100% Financing
A USDA home loan is a zero down payment mortgage for eligible rural and suburban homebuyers. USDA loans are issued through the USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program, by the United States Department of Agriculture.
The program primarily aims at helping low income borrowers seeking to purchase modestly priced homes. Qualification for a USDA home loan is based on household income and eligible properties must be located in an area with low population. A borrower may use the loan to purchase an existing dwelling or for new home construction. The loan can be made for over a period of 30 years with a fixed interest rate.
Is my location USDA Rural eligible in Southern Utah? As of September 22nd, 2019, the following yellow areas are ineligible. The remaining Southern Utah areas including Cedar City are eligible for a USDA Rural Loan.
Is my location USDA Rural eligible in Northern Utah? As of September 22nd, 2019, the following yellow areas are ineligible:
In order to qualify you’d need a minimum of a 620 credit score and meet other eligibility requirements.
- No down payment option (100% financing).
- No cash reserves required.
- Flexible credit and qualifying guidelines.
- Seller can pay closing costs.
- Low fixed interest rate.
- No pre-payment penalty.
Learn More about USDA Rural: Utah USDA Rural Home Loan Program
Utah Housing Loan – 100% Financing
Utah Housing is a special Utah-only home loan program that offers four loan programs with various guidelines that are required to qualify. All programs offer a second mortgage that covers your minimum down payment and even offers a “NoMI” program that provides 20% down for no private mortgage insurance.
If cash at closing is your challenge, a Utah Housing Corporation Down Payment Assistance Second Mortgage can help. When combined with their first mortgage, qualified borrowers can purchase a home with little or no cash investment.
Each Utah Housing program has different eligibility requirements. If you are interested in this loan program, please get in touch with me today to discuss your Utah Housing options.
To Learn More About Utah Housing: Utah Housing Home Mortgage Program
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