Is It Possible to Buy a House With No Money Down?
Yes, it’s possible to buy a house with no money down in 2025, provided you qualify for the right kind of loan.
For example, qualifying military personnel and veterans can apply for 0% down VA loans and rural homebuyers who meet the department’s income requirements can pursue no-money-down USDA loans.
Government-Backed Loan Programs With No Down Payment
The government doesn’t issue loans directly, but select agencies guarantee loans that private lenders issue to qualifying home buyers.
VA Loans
The Department of Veterans Affairs (VA) offers eligible veterans and servicemembers access to loans with no down payment or private mortgage insurance required and comparatively low interest rates and closing costs, both for purchases and refinancing.
The program is available to:
- Qualifying veterans
- Qualifying active duty servicemembers
- Qualifying family members
- National Guard members with at least 90 days of active service, including 30 consecutive days or more
USDA Loans
No-money-down USDA loans are available to low- and middle-income buyers in rural areas and some suburban communities. Income limits vary by locality and household size, which you can search using a USDA.gov navigation tool, but earnings cannot exceed 115% of your location’s median household income.
Low Down Payment Loan Options
There are also several paths to homeownership with small down payments.
- The Federal Housing Authority insures FHA loans, which require as little as 3.5% down, have flexible refinancing rules and are open to buyers with lower credit scores. However, they’re available only to first-time homebuyers who meet certain income restrictions and they require applicants to purchase mortgage insurance and participate in homeownership counseling.
- First-time homebuyers with strong credit but limited savings can pursue Conventional 97 loans, which require applicants to put at least 3% down and purchase mortgage insurance.
- Many states offer programs that provide first-time homebuyers with down payment assistance.
| Loan Type | Down Payment | Key Requirements | Who Qualifies? |
| VA Loan | $0 | Military service required | Veterans, active-duty members, some National Guard members |
| USDA Loan | $0 | Income and location limits | Rural homebuyers |
| FHA Loan | 3.50% | Lower credit score accepted | First-time buyers |
| Conventional 97 | 3% | Higher credit score needed | Low-income buyers |
Alternative Ways to Buy a Home With No Money Down
Those fortunate enough to have friends or family members with the means and the will to help can use cash gifts for a down payment in many circumstances.
Those who don’t can reduce the amount financed by negotiating seller concessions like closing costs. Alternatively, lease-to-own or rent-to-own agreements give tenants the option to save money while living in a property they intend to purchase after a set time.
Pros and Cons of Buying a House With No Money Down
The benefits of buying a home with no money down are lowering your upfront costs and skipping the years-long period of saving for a down payment that most buyers must endure on the path to homeownership.
The drawbacks are higher monthly payments, mortgage insurance costs, and, most consequentially, much higher long-term interest payments on 100% of the home’s principal cost.
Steps to Qualify for a No Down Payment Mortgage
Take the following steps to pursue a 0% down home loan successfully.
- Research the qualification standards for a program for which you might qualify.
- Check your credit score and report, challenge any errors you find, and work to improve your credit if needed.
- Check in with your financial accounts and gather all documents required to qualify for the program and apply for the loan.
- Find a lender offering no-down-payment options.
- Submit your application and secure pre-approval.
Common Mistakes to Avoid
Buying a home is tricky enough, but buying one with no money down demands an extra layer of qualifying criteria, supplementary documentation and more chances to make a mistake — avoid these at all costs.
- Not fully understanding the eligibility requirements for your chosen 0% down loan program.
- Choosing the wrong type of loan.
- Failing to budget for all the various closing costs.
- Ignoring long-term homeownership costs like utilities, maintenance and repairs.
Good To Know
Many veterans and active duty service members are not aware of their eligibility for a no-money-down VA home loan. If you’re currently serving or are a veteran and aren’t sure if you qualify for a VA loan or other veterans benefits, check with your local VA office to find out.