Zero-Down Loan Programs
Two federal loan programs offer true zero-down-payment financing. These are not gimmicks — they are established government-backed programs used by hundreds of thousands of buyers every year.
VA Loans
VA loans are the gold standard of zero-down financing. Available to eligible veterans, active-duty service members, National Guard and Reserve members, and surviving spouses, VA loans offer:
- Zero down payment: No down payment required on any loan amount within VA limits
- No mortgage insurance: Unlike FHA and conventional loans, VA loans have no monthly mortgage insurance premium
- Competitive rates: VA loan rates are typically lower than conventional rates because the government guarantee reduces lender risk
- Flexible credit: No minimum credit score set by the VA (though lenders may set their own minimums, typically 580-620)
- Funding fee: A one-time fee (typically 1.25-3.3% of the loan) that can be rolled into the loan — waived for veterans with service-connected disabilities
USDA Loans
USDA loans serve buyers in eligible rural and suburban areas — and "eligible" covers far more territory than most people expect. Many suburban communities near major cities qualify. Key features:
- Zero down payment: No down payment required for eligible properties and borrowers
- Income limits: Household income must be at or below 115% of the area median income
- Location-based: Property must be in a USDA-eligible area (check the USDA eligibility map online)
- Guarantee fee: An upfront fee of 1% of the loan amount plus an annual fee of 0.35%, both lower than FHA mortgage insurance
Down Payment Assistance Programs
Over 2,000 down payment assistance programs exist across the country. State housing finance agencies, city and county governments, and nonprofits offer grants (free money), forgivable second mortgages (forgiven after 5-10 years of occupancy), and deferred-payment loans. These can be combined with FHA or conventional loans to achieve effectively zero-down purchases even for buyers who do not qualify for VA or USDA loans.
Lender-Paid PMI Options
Some lenders offer to pay your private mortgage insurance in exchange for a slightly higher interest rate. This eliminates the separate PMI payment and can reduce your total monthly obligation compared to borrower-paid PMI. It works best for buyers who plan to stay in the home long-term, since the higher rate is permanent (unlike borrower-paid PMI, which drops off at 80% loan-to-value). Compare total costs over your expected ownership period.
Find an Agent Who Knows Zero-Down Programs
Not every agent or lender is experienced with VA, USDA, and down payment assistance programs. We connect you with professionals who specialize in helping buyers maximize available programs.
Get Matched with an AgentState and Local Programs
Every state has a housing finance agency that offers programs beyond federal options. These are often the most generous and least well-known sources of help for buyers:
- State bond programs: Below-market interest rates funded through state-issued bonds, available to income-qualifying buyers
- Mortgage credit certificates: Annual federal tax credits equal to a percentage of your mortgage interest, reducing your tax bill every year you own the home
- Employer-assisted housing: Some large employers offer down payment matching, forgivable loans, or homebuying grants as employee benefits
- Community land trusts: Nonprofits that own the land and sell you the home at a reduced price, keeping housing affordable long-term
Is Zero-Down Right for You?
Buying with no down payment means you start with minimal equity, which carries some risk if home values decline in the short term. However, for buyers with stable income, an emergency fund, and plans to stay at least 5 years, the math often favors buying now rather than spending years saving for a down payment while rents increase and home prices rise. The key is ensuring your monthly payment — including taxes, insurance, and maintenance — fits comfortably within your budget.