No Money Down Mortgage: Full Home Financing

2007-03-08 10:33:40

( Financial )



ZERO CASH LAYOUT

No money down mortgage is a fairly simple mortgage plan – you finance the entire amount of the property you are going to buy. Under a no money down mortgage, there will be no cash layout on your part because you will not be required to put up a down payment.

There was a time when no money down mortgage was unheard of. Most banks and lending companies are not willing to give one hundred percent financing. Maybe lenders consider the down payment as earnest money, and an indication of the borrower’s financial ability to pay the loan.

No money down mortgage is a bit more complicated to apply for. If have your heart set on a no money down mortgage, you must have a very good credit history and your outstanding loans, if any, must be very well covered by your regular income. Simply put, your household’s income should be a bit higher than the normal.

FEATURES OF A NO DOWN MORTGAGE

There are some restrictions in a no money down mortgage. Foremost of this is that there is a ceiling on the value of the property you can buy. You cannot just choose anything you want because if the property exceeds the maximum loan-able value, then you will not be approved for the mortgage.

Except for the features mentioned above, a no money down mortgage is very similar to standard mortgages. It is just like paying a regular mortgage, only that your monthly payments will be higher. No money down mortgage will still require you to pay closing costs. They may also have fixed or variable interest charges.

Most banks and lending institutions offering mainstream loans are now offering no money down mortgage plans as well. Examples of lenders offering them are black horse loans and money tree lending. You are bound to find a lender that works best with your needs.


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