Can you really buy a house with no money down?

Yes. VA loans and USDA loans both offer true zero down payment mortgages. VA loans are for eligible military borrowers and USDA loans are for homes in eligible rural and suburban areas. Both are backed by the government.

What is the catch with zero down payment mortgages?

There is no hidden catch, but you start with zero home equity, meaning you owe the full purchase price. VA loans charge a funding fee (which can be financed) and USDA loans have guarantee fees. Neither requires PMI. Your monthly payments will be higher than with a down payment.

Do zero down payment loans have higher rates?

VA loans actually tend to have lower rates than conventional loans. USDA rates are also competitive. The zero down feature does not typically result in a higher interest rate for these government-backed programs.

No Down Payment Mortgages: Buy a Home With $0 Down

Think you need a big down payment to buy a home? Several programs let you purchase with nothing down. Learn about VA loans, USDA loans, and other zero-down options.

Zero Down Payment Loan Programs

$0

VA Loan Down Payment

$0

USDA Down Payment

No PMI

VA Loan Advantage

97%

Areas Eligible for USDA

VA Loans — The Gold Standard of Zero Down

VA home loans are available to veterans, active-duty service members, National Guard/Reserve members, and surviving spouses. Key benefits:

True Zero Down

No down payment required on any loan amount. Since 2020, there is no VA loan limit for borrowers with full entitlement.

No PMI Ever

VA loans have no private mortgage insurance, saving $100-$400/month compared to conventional or FHA loans with low down payments.

Competitive Rates

VA rates are typically 0.25-0.50% lower than conventional rates. Check current VA rates.

USDA Loans — Zero Down for Rural/Suburban Areas

USDA loans offer 100% financing for homes in eligible rural and suburban areas. Despite the name, many suburban communities near major cities qualify. Key features:

USDA Loan Requirements

Location — home must be in a USDA-eligible area (check USDA eligibility maps)
Income limits — household income cannot exceed 115% of the area median
Credit score — typically 640+ for automated approval
Primary residence only — must be your primary home, not investment property
Low guarantee fee — 1% upfront + 0.35% annual (much lower than FHA MIP)

Low Down Payment Alternatives

Program	Down Payment	Key Requirement	PMI/Fee
VA Loan	0%	Military service	No PMI (funding fee)
USDA Loan	0%	Rural/suburban + income limits	Low guarantee fee
FHA Loan	3.5%	580+ credit score	MIP for loan life
Conventional 97	3%	First-time buyer, 620+ credit	PMI until 20% equity
DPA + Conventional	0% effective	State program eligibility	Varies

The Trade-Off: Lower Down = Higher Monthly Cost

While zero down makes homeownership accessible sooner, it means a larger loan balance. Use our mortgage calculator to compare monthly payments at different down payment levels, or check your affordability to find the right balance.