Do you want to own a Silicon Valley home but are worried about saving up enough for a down payment? What if I told you that you could purchase a home with no money down? It's possible. Restrictions apply, of course. Read on to find out how you can buy a Silicon Valley home with no money down.
How to Buy a Silicon Valley Home With No Money Down
Are you or your spouse currently a member of the military? Have you served in any branch of the military in the past (including the Reserves or National Guard)? As long as you were discharged honorably, you could be eligible for a VA loan. While the VA itself doesn't loan out money, they do guarantee loans for veterans. That means no money down and no mortgage insurance. However, the VA does require a funding fee. This runs anywhere from 1.25% to 3.3%. If you're a first-time homebuyer (haven't owned a home in the last three years), you pay 2.15%. Reserve or National Guard members pay 2.4%. This fee helps fund the VA loan program and can be included in your monthly mortgage payment.
When utilizing VA loans for your Silicon Valley home purchase, you will encounter some restrictions. The home must be move-in ready. No fixer-uppers here. Your credit score needs to fall in line with the lender's requirements. Many VA-approved lenders look for at least a 620 FICO score. Also, you must meet the income requirements set forth by the lender. Debt-to-income ratio is considered. Currently, the VA only backs standard loans for single-family homes in Alameda County up to $636,150. Anything higher than that is considered a jumbo loan. The VA jumbo loan can run a couple of points higher than a standard VA loan. Talk to your mortgage company about the particulars if this applies to you.
Zero Cash Down Payment Program
Not a veteran? You may still qualify for the Zero Cash Down Payment Program. Have you regularly been paying your bills on time? Don't have any recent bad debts? Do you have a low debt load? Have you been employed with the same company continually for at least the last three years? Do you make enough money to afford a higher payment? Then, you have a good shot at qualifying for the Zero Cash Down Payment Program with your new Silicon Valley home. Make sure to discuss this option with your mortgage company. They can answer any questions you may have.
A big down payment helps lower your monthly mortgage payment. But you don't necessarily have to come up with a huge amount of cash to buy your dream home. You may qualify for to buy a Silicon Vally home with no money down. Feel free to contact your Silicon Valley REALTOR@ if you have any questions. Also, visit my Home Buying page for more helpful buyer tips.