Best low and no down payment mortgage lenders in 2022
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If you meet eligibility requirements, it’s possible to get a low- or no-down payment mortgage, which can put you on an easier path to homeownership. Bankrate examined several mortgage lenders to uncover the best for these types of loans, based on measures including low-down payment programs, lower fees and other opportunities to save. Here is our guide to the best low- and no-down payment mortgage lenders in 2022.
Methodology
To determine the best low- and no-down payment mortgage lenders, Bankrate evaluated lenders based on several criteria, including pricing, accessibility, availability of low-down payment loan programs and borrower experience.
Best low- and no-down payment mortgage lenders
Bank of America
Bank of America mortgage review
| Loan products | Purchase and refinance; conventional, jumbo, FHA, VA, home equity line of credit (HELOC) |
| Credit requirements | 620 for conventional loans; 680 for jumbo loans |
| Pros |
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| Cons |
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| Highlight | The bank’s Affordable Loan Solution and Freddie Mac Home Possible mortgage products only require a 3 percent down payment. |
Flagstar Bank
| Loan products | Purchase and refinance; conventional, jumbo, FHA, VA, USDA, home equity loan, construction and renovation loans |
| Credit requirements | 620 for conventional loans; 700 for jumbo loans; 580 for FHA loans |
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| Cons |
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| Highlight | Flagstar Bank offers several programs to help homeowners with the down payment and closing costs. |
PNC Bank
| Loan products | Purchase and refinance; conventional, jumbo, FHA, VA, USDA, HELOC, home equity loan, investment property, interest-only |
| Credit requirements | 620 for conventional loans, jumbo loans and FHA loans; 640 for USDA loans |
| Pros |
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| Cons |
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| Highlight | PNC Bank offers a closing cost assistance grant of up to $5,000. |
New American Funding
New American Funding mortgage review
| Loan products | Purchase and refinance; conventional, jumbo, FHA, VA, USDA, HELOC, investment property, flex-term, non-QM, reverse mortgages |
| Credit requirements | 620 for conventional loans |
| Pros |
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| Cons |
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| Highlight | New American Funding offers several low- and no-down payment loan options. |
Navy Federal Credit Union
Navy Federal Credit Union mortgage review
| Loan products | Purchase and refinance; conventional, jumbo, VA |
| Credit requirements | 620 for conventional loans and VA loans |
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| Cons |
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| Highlight | Navy Federal Credit Union offers an incentive of up to $9,000 if you use a real estate agent in the Navy Federal RealtyPlus network. |
Low-down payment mortgages
| Conventional 97 loans | HomeReady/Home Possible loans | FHA loans |
| 3% down | 3% down | 3.5% down |
| 620 credit score | Flexible underwriting | 580 credit score (500-579 score with 10% down) |
| Income limits | Income limits | No income limits |
| First-time homebuyers | First-time and repeat homebuyers | First-time and repeat homebuyers |
No-down payment mortgages
| VA loans | USDA loans |
| No money down | No money down |
| Flexible underwriting | Flexible underwriting |
| No income limits | Income limits |
| Eligible servicemembers, veterans and spouses | Borrowers in eligible locations |
Low- and no-down payment mortgages: Pros and cons
Pros
- Gets you out of renting and into a home sooner
- Allows you to buy a home now instead of in the future, when it could cost more
- Allows you to reserve your savings (if applicable) for emergencies or other goals
Cons
- Less money down means you’re borrowing more, which translates to higher monthly mortgage payments
- Limited equity upfront so you can’t use it in an emergency, and if the market turns, you could owe more than the home’s worth
- Low-down payment loans require mortgage insurance
- Low-down payment loans could come with higher interest rates
- No-down payment loans come with extra fees
- Some sellers consider less money down a negative, which can be a disadvantage in a hot market
Summary: Best low and no down payment mortgage lenders
With additional reporting by Allison Martin
Learn more:
- Best mortgage lenders of 2022
- 9 ways to save for a down payment on a house
- How much is a down payment on a house?
- How to find mortgage down payment assistance, including free money