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.

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.

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. The PMI payment ranges from 0.19 percent for a fixed rate loan with a 15 percent down payment; up to 1.09 percent with zero down; and as high as 1.34 percent on a zero down variable rate.

---

First Secure Financial - 357 W. 2nd Street, Suite 12 - San Bernardino, CA 92401
Office Phone: (909) 383-7556 Toll Free Phone: (800)308-7218

California Department of Real Estate Broker License #01471868. 

© 2010 Myers Internet All Rights Reserved

Powered by: Myers Internet | Admin Login