Q: All I have ever wanted is a small piece of property — as little as a half an acre with a shack — in the northern mountains of North Carolina.
Is there any way I can buy without a down payment? I had $4,000 saved as a down payment, but I’ve had to use it on family medical bills. I am saving again for this purpose, but it is so slow.
A: Unless you’re a veteran (with access to a VA loan), it’s difficult to get a zero down payment loan right now. In fact, home buyers with cash for a down payment are having trouble finding mortgage lenders who want to close on their properties at a fair interest rate.
You’ll have an easier time of it if you even have 3 percent of the purchase price, which can entirely be a gift from someone else (if you have someone with means willing to gift you the cash). Then, you can qualify for an FHA loan (find out more at www.fha.gov.)
I’m not saying you can’t get a loan with zero down, but you may pay a higher interest rate or more in fees. Start shopping around with loan lenders and see what they say you can afford. The key thing is to not get yourself into a situation where you can’t afford what you own. Bankruptcy is expensive and will trash your credit.
Sept. 2, 2007.
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