Do Credit Card Payment Histories Help With Mortgage Qualifications

Obtaining a mortgage with zero percent down seems like a dream to many people. Prior to the 2007 recession it was more common to run into these types of offers, which were very appealing to many people. After the real estate bubble and the economic meltdown in 2007 however, these types of offers became very scant. Now a days banks hardly ever offer these type of loans, yet that does not mean it is impossible to obtain these type of loans.

One way to obtain this type of loan is if you are a veteran. If you are a veteran, you can qualify for a no down payment mortgage through the U.S. Department of Veterans Affairs, provided that you qualify for a mortgage. You will need a credit score of at least 580 and stable income to qualify. You will also need to obtain a Certificate of Eligibility from the U.S. Department of Veterans Affairs. The price of the home most not exceed the appraised value of the home, and you may not have any private mortgage insurance if you go this route. Closing costs must also not be excessive.

Another option is one that few know about. You can opt for a no down payment USDA loan. These loans are through the The United States Department of Agriculture , and many of these loans feature very low interest rates. The catch being that the property you intend to buy must be in a rural area. These loans are intended for those with low to moderate incomes yet who have decent credit to be able to buy a home in rural America. They even have a plan for people to buy manufactured homes, such as mobile homes, provided that they have incomes above 60 percent of the average medium income of the area they plan to live, this program is known as the single family direct home ownership loan. Another loan for this purpose is the single family guaranteed home ownership loan. This is their loan for people with lower incomes, this loan helps those whose incomes fall below 115 percent of the median income of the area to buy an home in the area.

While these type of loans allow you to buy a home without having to save a massive amount for a down payment they do have their cons to them. For example this means that you have no equity at the start, which for most home owners is a safety net they can borrow against in times of need. You will not be able to take out a HELOC or a home equity loan until you have made enough payments to build up equity. You are also apt to be paying your loan off far longer than someone who paid a moderate down payment on their home. This of course translates to paying the bank back thousands of dollars in added interest over the lifetime of the loan, which is something to take into consideration, unless you opt for the low interest USDA loans.

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