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USDA Financing – No Down Payment

For a while there was a scare about lack of funding and additional reasons as to why this loan product would soon be unavailable – but it’s still here! And for how long… nobody knows. Technically, Casa Grande doesn’t qualify due to our growing population but we were kept in under an exception and will continue to utilize it as long as possible.

This loan program allows first time homebuyer, and in some cases, second home purchasers relocating, to purchase homes without a down payment. The loan provides up to 102% of appraised value in financing which means some of the closing costs and guarantee fees can be financed, depending on the appraised value. The loan also doesn’t require cash reserves and gift funds are acceptable for closing costs.

Another great feature is that sellers can contribute up to 6% towards the buyer’s closing costs – this means that a buyer could potentially purchase a property with no money down – and the mortgage payment will probably be less than rent!

Rates are comparable to FHA financing and flipped properties are allowed. The property must be owner occupied and there are some household income limits, but most first time homebuyers will fit into the program guidelines.

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