# 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. 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. ### 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. **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). ## Frequently Asked Questions ### What credit score do you need to buy a house with no down payment? For VA loans, most lenders set a floor of 580–620, though there's no official VA minimum. For USDA loans, most lenders require 640+. For FHA loans (3.5% down), you need 580+ for the low down payment option. ### Can you really buy a home with no money down? Yes — with a VA or USDA loan, or with down payment assistance that covers your full down payment. But you'll still need cash for closing costs unless the seller agrees to cover them or your DPA program includes closing cost help. ### What is the income limit for a USDA loan? USDA income limits vary by location and household size. Generally, your household income must be at or below 115% of the area median income. In 2026, that's roughly $110,000 for a family of four in many areas, but check the USDA eligibility map for your specific area. ### Can a first-time buyer get a zero-down mortgage? Yes, through USDA loans (if the area qualifies) or down payment assistance programs. VA loans are available to veterans regardless of first-time buyer status. ### Does a no-down-payment loan mean higher monthly payments? Yes, because you're financing the full purchase price. Your payment will be higher than if you had put 10% or 20% down on the same home. Also factor in mortgage insurance if you're using FHA or USDA. ### Can you use gift money for a down payment? Yes — most loan programs allow gift funds from a family member. You'll need a gift letter documenting the amount and confirming it doesn't need to be repaid. The rules vary by loan type, so check with your lender. ### Are there zero-down programs for people who aren't veterans? Yes — USDA loans for eligible rural areas, and state/local down payment assistance programs. These aren't universally available but cover a significant portion of buyers. ## The Bottom Line Buying a house with no money down is genuinely possible for the right buyer in the right situation: - **VA loan:** Best option available — zero down, no PMI, competitive rates. Available to qualifying military. - **USDA loan:** Zero down for eligible rural areas and households within income limits. - **DPA programs:** Available in all 50 states, covering part or all of a down payment for qualifying buyers. If you don't qualify for any zero-down path, 3% conventional or 3.5% FHA loans combined with DPA can get you very close. The key in all cases: understand your total cash needed at closing — not just the down payment — and make sure your budget has room for the higher monthly payment that comes with little or no equity at the start. Browse homes on Opendoor to see move-in ready listings in your area — with upfront pricing and no-pressure offers. --- *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)*