Are you wondering if you can get approved for a home loan with 100% financing? Are you also wondering if its a good idea to get a mortgage loan with no money down? Here are some points to keep in mind as you apply and consider your different mortgage loan options.
To qualify for 100% financing on a purchase mortgage loan, it would be important for you to have a credit score of at least 600 or higher. If you are between 600-650 on your credit rating, you may need to go through a subprime mortgage lender in order to get 100% financed.
If your credit score is higher than 650, you can probably apply with most mortgage lending companies online and be able to get an approval.
If your credit score is between 580-600, you will probably need at least 5% down to make the loan work with a subprime mortgage lender.
Getting a mortgage loan with 100% financing can sometimes mean a higher rate. Sometimes an alternative is to get an 80/20 loan, which is a first and second mortgage, with the first mortgage being at a lower rate and the second mortgage being at a higher interest rate. The benefit to doing this type of loan is that it eliminates the need for PMI insurance, which can be $100 or more a month, depending on the size of your loan.
Also, consider getting quotes for 100% financing and then quotes for 95% financing, with you putting 5% down. See, if the savings on the interest rate is worth putting the money down.
To view our list of recommended mortgage lenders online who can provide 100%
financing for good and bad credit, visit this page:
lenders for 100% financing for people with good or poor credit history.
Carrie Reeder is the owner of ABC Loan
Guide, an informational website about various types of loans.