No-Down and Low-Down Mortgages
The Federal Housing Authority (FHA),is part of the U.S. Department of Housing and Urban Development (HUD). FHA has lots of programs available to help the low and moderate income families to get a decent mortgage plan. It helps the first time buyers and provides them with mortgage insurance for private lenders. In addition FHA help other people that do not qualify for conventional loans. The Interest rates for an FHA loan are usually the going market rate, while the down payment requirements for an FHA loan are lower than conventional loans. The required down payment can be as low as 3 percent and the closing costs can be included in the mortgage amount.
VA Loans are guaranteed by the U.S. Department of Veterans Affairs. VA Loans are provided to all Service persons and veterans. These loans have low interest rate, require 0 down payment and have other similar advantages. VA itself does not issue this loan but they can provide you with a certificate and this certificate will make you illegible for the loan.
The buyer has two mortgages and the second one starts after the first one ends. 80 percent of the total purchase is covered by the first mortgage while the piggy back will cover more than 10 percent of the rest. The down payment will cover the rest of the 10 percent while some lenders can facilitate you by writing the second mortgage of 15-20 percent as well.
“Carry Back” Mortgage
When a seller allows agrees to carry a second mortgage then he facilitates you by giving away his own equity. The situation becomes very simple because you pay major portion of the loan to traditional lender and rest of the loan is financed to the seller. You just have to pay little higher interest rate to the seller.
Housing Finance Agencies
There are some agencies that facilitate the low-moderate income families to get special loans that help them to rehabilitate a house or buy a new house. If you go through these agencies, there is a chance that you will get low interest rate and they will also assist you in down payment.