Special loan programs
Always compare official loan offers, called Loan Estimates, before making a final decision.
- Often offer low-cost, streamlined refinance options and additional protections if you have trouble paying your mortgage later on
- Do not require monthly mortgage insurance premiums, but usually require an at closing
- Are available with low or even zero down payments, but may be more expensive than conventional loans if you have significant down payment funds and good credit
The VA guarantee replaces mortgage insurance. More on mortgage insurance.
USDA loan (or rural development loan)
USDA loans can be a good option for borrowers who have little available savings. They offer zero down payments and are usually cheaper than FHA loans. Borrowers will pay an upfront fee as well as ongoing mortgage insurance premiums to the USDA.
Mortgage insurance is required by all USDA loans. More on mortgage insurance.
State and local programs
Many states, local governments, and nonprofits offer programs to make homeownership more affordable. Many of these programs focus on low- and moderate-income families buying their first home, though some may be available to families who have previously owned a home. Other programs target teachers, firefighters, and other public service employees, or people interested in purchasing a home in a particular neighborhood.
If you think you might qualify, or contact a local housing counselor to discuss your options. You can also ask local lenders whether they offer any special programs.
Mortgage insurance is required by many state and local programs. More on mortgage insurance.