Buying Real Estate With No Money Down

Advertisements constantly hammer us with the fact that anybody can qualify for a mortgage with no money down. Buying real estate can and should be a quality financial investment. Purchasing a piece of real estate, whether as a primary residence or as an investment property with zero money down can be either a very smart move or a very dumb move depending on how the real estate investment is handled.

There are several ways to purchase a home with no money down. 

You may qualify for 100% financing; with decent credit and good income there are mortgages available to literally cover all of the costs of purchasing a home. In some cases these loans may actually be two loans, referred to as a "piggyback" mortgage. 

In some cases, the seller of a home may be interested in selling their home on a lease-option.  In these scenarios, you can lease a property for a specific length of time and receive a portion of your monthly lease payment as a credit towards a downpayment.

There may be situations in which a seller will agree to finance all or part of the home they are selling for you.  These situations are referred to as "seller-carrybacks" because the seller basically finances either the downpayment or the entire sale price of the home. In effect, the seller becomes your mortgage bank.

Sometimes, the acquisition costs or closing costs can even be financed along with the sales price of the home.  There are even mortgage programs available in some instances where you can finance the entire purchase price of a home along with the costs of necessary improvements or upgrades.

If someone has had difficulty being financed in the past, these loans can often be a good way to overcome that. Home financing has always been a difficult proposition, even with the best mortgage brokers and lending institutions.

These solutions are normally best suited to someone who will be purchasing a home as a primary residence.

For the real estate investor who is looking to purchase a home as an investment, whether as a rental property or for a quick sale, these types of mortgages are not a good idea.