Putting up 20% for a down payment on a home is a big ask, especially for a Millennial. These last ten years have been rough, and have left many Millennials burdened with enormous college debt, stagnant wages, and little in the way of extra cash. As more and more Millennials become first-time homeowners, many wonder how to do it without putting up the thousands of dollars a down payment requires. The short answer is: it can be done. The catch is: you have to qualify. Virtually all loans are going to require a good credit score and adequate income, but a few work to benefit specific populations.
Check out the information below to see if there’s a program to help you.
Veterans Affairs Loans
USDA Rural Development Loans
The US Department of Agriculture aims to help residents in rural areas with low and moderate incomes by offering low-interest-rate no-down-payment loans. The requirements can be found here.
State and Local Homebuyer Programs
For a time, it was relatively easy to get a loan with no down payment and almost no interest. As the economy has shifted in recent years, those have become more rare. Still, home buyers may be able to find help through a state or local agency. The National Council of State Housing Agencies (NCSHA) has some great resources on its website.
Not having to make a down payment makes it possible for many more people to afford a new home. It’s important to keep in mind, however, that you’ll still be paying that money. Instead of paying a big chunk up front, the 30% will be included in your monthly payments and, likely, will make those payments higher.
Whatever you decide, having a good credit score will help tremendously. Get your scores up, sock away some money, and plan out a budget to ensure you can make those monthly payments.