# How to Buy a House with No Money Down (2026) By Opendoor Editorial Team | 2026-04-29 Yes, you can buy a house with no money down — but it's not available to everyone, and it comes with trade-offs you need to understand before you apply. This guide covers every zero-down option; when you're ready for the full home buying process, see our [complete step-by-step guide to buying a house](/articles/how-to-buy-a-house). For the full requirements checklist beyond just the down payment, see: [What Do You Need to Buy a House?](/articles/what-do-you-need-to-buy-a-house) There are two federal zero-down loan programs: **VA loans** (for veterans and active military) and **USDA loans** (for rural areas). Beyond those, down payment assistance programs across all 50 states can help eligible buyers cover most or all of their down payment. Here's a complete breakdown of every legitimate path to buying with little or no money down. ## The Two True Zero-Down Mortgage Programs ### VA Loans (Veterans and Active Military) A VA loan is the strongest no-money-down option available. Backed by the Department of Veterans Affairs, it offers: - **0% down payment** — no minimum required - **No private mortgage insurance (PMI)** — saves $100–$300+/month compared to FHA or conventional - **Competitive interest rates** — often lower than conventional - **No loan limit** for borrowers with full entitlement (as of 2020) **Who qualifies:** - Active duty service members (90+ days of service, or 181+ days during peacetime) - Veterans who meet service requirements - Surviving spouses of veterans who died in service or from a service-related disability - Some National Guard and Reserve members (6+ years of service) **What you'll still pay:** - A **VA funding fee** (typically 1.25%–3.3% of the loan amount, depending on down payment and whether it's your first VA loan) — this can be rolled into the loan - Closing costs (2%–5% of loan amount) — some can be negotiated with the seller - VA appraisal fee (typically $500–$800) **Minimum credit score:** No official VA minimum. Most lenders set their own floor at 580–620. For the full credit score picture by loan type, see: [What Credit Score Do You Need to Buy a House?](/articles/credit-score-to-buy-a-house) ### USDA Loans (Rural and Suburban Areas) The USDA Rural Development loan program is available to buyers in eligible rural and some suburban areas. Benefits include: - **0% down payment** - **Lower mortgage insurance** than FHA (0.35% annual guarantee fee vs. 0.55% for FHA) - Fixed 30-year terms **Who qualifies:** - Buyers in USDA-eligible geographic areas (check eligibility at usda.gov) - Income limits: generally, your household income must be at or below 115% of the area median income (AMI) **What you'll still pay:** - Upfront guarantee fee: 1% of the loan amount (can be rolled into the loan) - Annual fee: 0.35% of remaining loan balance - Closing costs (though sellers can contribute up to 6%) **Minimum credit score:** No official minimum, but most USDA lenders require 640+. ## Down Payment Assistance Programs (DPA) If you don't qualify for VA or USDA, down payment assistance programs are the next best option. These programs — offered through state housing finance agencies, local governments, and some nonprofits — provide grants or low-interest second loans to cover your down payment. **Types of DPA:** | Type | How It Works | | --- | --- | | Grant | Free money — doesn't need to be repaid | | Forgivable loan | Repaid only if you sell or refinance within a set period (often 5–10 years) | | Deferred loan | Repaid when you sell, refinance, or pay off the home | | Second mortgage | A low-interest second loan on top of your primary mortgage | **How much can DPA cover?** Amounts vary widely. Some programs cover 3%–5% of the purchase price. Others cover the full down payment. A few cover closing costs too. **Who qualifies?** Requirements vary by program, but common eligibility criteria include: - First-time homebuyer (or not having owned a home in the past 3 years) - Income at or below area limits (typically 80%–120% of AMI) - Minimum credit score (often 620–640) - Primary residence purchase only - Completion of a homebuyer education course **How to find programs in your state:** Search the HUD-approved housing counselor database at hud.gov, or check your state housing finance agency website. Your mortgage lender may also be aware of local programs you qualify for. ## Low-Down-Payment Options (Not Zero, but Close) If you don't qualify for the above programs, these options require only 3%–3.5% down: | Loan Type | Minimum Down | Notes | | --- | --- | --- | | FHA loan | 3.5% (580+ score) or 10% (500–579) | Mortgage insurance required | | Conventional 97 (Fannie Mae) | 3% | 620+ score, PMI required | | Freddie Mac Home Possible | 3% | Income limits apply | | Freddie Mac HomeOne | 3% | First-time buyers only | On a $350,000 home, 3% down = $10,500. Combined with a DPA grant, many buyers reach zero out-of-pocket. ## The "No Money Down" Fine Print: What You'll Still Need to Pay **No money down does not mean no money.** Here's what zero-down buyers still need to cover: - **Closing costs:** 2%–5% of the loan amount. On a $300,000 loan, that's $6,000–$15,000. Some programs help cover these; sellers can also contribute (ask your agent to negotiate seller concessions). - **Earnest money deposit:** Typically 1%–2% of the purchase price, held in escrow. This goes toward your closing costs at settlement. - **Home inspection:** $300–$600 out of pocket. - **Moving costs:** $1,000–$5,000. - **Immediate repairs or purchases:** Budget for this separately. **The real ask:** Even for zero-down buyers, having $5,000–$10,000 in savings reduces stress and gives you a buffer for unexpected costs. ## What You Give Up with No Money Down Zero down isn't always the right choice even if you qualify. Here's what to weigh: **Higher monthly payment:** On a $350,000 home at 6.5% with no down payment, you're paying principal and interest on the full $350,000. A 5% down payment ($17,500) drops your loan to $332,500 — saving about $100/month on PI alone. **Mortgage insurance (for non-VA loans):** FHA loans require mortgage insurance for the life of the loan unless you refinance. Conventional loans with less than 20% down require PMI, which cancels when you reach 20% equity. For a full breakdown of how mortgage insurance works and what it costs, see: [What Is Mortgage Insurance (PMI)?](/articles/what-is-mortgage-insurance-pmi) **Less equity cushion:** If values dip and you need to sell, you could owe more than the home is worth (be "underwater") with no down payment. **VA and USDA avoid these drawbacks better than FHA** — VA has no PMI and competitive rates; USDA has lower insurance costs. ## Mortgage Options: VA vs. USDA vs. FHA vs. Conventional For a full breakdown of how VA, USDA, FHA, and conventional loans compare — including credit score requirements, insurance costs, and loan limits — read our guide: [Types of Mortgage Loans](/articles/types-of-mortgage-loans). --- *Originally published at [https://www.opendoor.com/articles/how-to-buy-a-house-with-no-money-down](https://www.opendoor.com/articles/how-to-buy-a-house-with-no-money-down)*