Zero Down

A zero down loan is good when you don't have enough cash to pay your closing costs and make a down payment on the purchase of your home. It is also used to avoid paying Private Mortgage Insurance (PMI) costs.

Zero down programs allow you to buy your home now, instead of waiting to save enough for a down payment. Some 1st time home buyer programs include FHA, PFHA, Dream maker and several other programs are avaialble

There are several options available for buying a home with zero down.

1. Get one new loan at 100 percent loan-to-value (LTV). PMI is usually required, and the insurance charges are not tax deductible.
2. Get an 80 percent first loan and a 20 second (piggy-back or 80/20) loan. This program does not require PMI, and all interest is tax deductible.
3. Get a new first loan and have the seller carry back a second loan for the balance of the purchase price.

Some zero down programs allow you to borrow 3 to 6% of the purchase price to pay your closing costs. Ask your loan officer if you qualify for any of these programs.

PMI is an additional charge you pay if you make less than a 20 percent down payment. This insurance policy protects the lender in the event of a payment default or foreclosure, and the loan is not paid off in full.

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Northeast Financial Corp - 920 Lenmar Drive - Blue Bell, PA 19422
Office Phone: (610) 291-6415

Licensed Mortgage Banker in PA, NJ and FL

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