How to Buy a House With No Money Down in 2026
Every zero-down and low-down-payment option available to home buyers this year, with real numbers and eligibility details.
Saving for a traditional down payment is the biggest barrier to homeownership for millions of Americans. The good news: you do not need 20% down to buy a house. Multiple no-down-payment mortgage programs and low down payment loan options let you buy a home without saving tens of thousands of dollars. If you can not save for a down payment, you do not need to save the full 20%. There are several ways to buy a house without a minimum down payment, and dozens of assistance programs can cover your remaining payment or closing costs.
Whether you are a veteran, a first-time home buyer, or someone looking to buy with low money saved, it's possible to buy a home with no down payment in 2026. If you want to buy a home but have not saved enough, government-backed home loans like VA and USDA mortgages make it possible to buy a house with zero down. You'll need to meet certain eligibility requirements, and you'll need to borrow more overall, but the path to homeownership is open. This guide breaks down every option to purchase a home with real numbers and the costs you should still plan for.
Can You Buy a House With No Money Down?
Yes. Buying a home without a down payment is possible. Two government-backed loan programs don't require a down payment at all: VA and USDA loans. These programs allow eligible buyers to finance 100% of the home purchase price. Conventional loans typically require a down payment, but programs like HomeReady bring it down to a 3 percent down payment. If you don't make a down payment, you still pay closing costs, but buying with no money down is possible for qualifying borrowers.
Beyond those two options, several programs bring the required amount down to 3% or 3.5%. When combined with down payment assistance programs, many buyers can cover their down payment and closing costs with assistance. Each lender may set a minimum credit score, so the minimum credit score requirement varies. Buyers with credit issues still have paths to homeownership through FHA and other programs.
The 20% down payment standard is a myth for most buyers. The National Association of Realtors reports that the median down payment for first-time buyers was just 8% in 2025. You can buy a home without a large savings account. A loan with no down payment or a low down payment loan helps you buy a home sooner and start building home equity now instead of waiting years. Even buyers with lower credit scores have options. While a higher interest rate is possible with less money down, the tradeoff is often worth it compared to paying rent and building no equity.
Zero-Down & Low-Down Loan Comparison
Here is how every major low-down-payment mortgage option compares in 2026.
| Loan Type | Min Down | Min Credit Score | PMI/MIP | Who Qualifies |
|---|---|---|---|---|
| VA Loan | 0% | 580–620 | None | Veterans, active military, surviving spouses |
| USDA Loan | 0% | 640 | 0.35%/yr guarantee fee | Income-eligible buyers in rural areas |
| FHA Loan | 3.5% | 580 | 0.55%/yr MIP (life of loan) | Any buyer |
| HomeReady (Fannie Mae) | 3% | 620 | Reduced PMI, removable at 20% | Income ≤80% AMI |
| Home Possible (Freddie Mac) | 3% | 620 | Reduced PMI, removable at 20% | Income ≤80% AMI |
| Conventional 97 | 3% | 620 | Standard PMI, removable at 20% | First-time buyers (at least 1 borrower) |
AMI = Area Median Income. Credit score requirements may vary by lender. Data reflects 2026 program guidelines.
VA Loans: 0% Down for Veterans
The VA loan is the single best no-down-payment mortgage available for eligible borrowers. Backed by the U.S. Department of Veterans Affairs, it offers zero down payment, no private mortgage insurance, and competitive interest rates that are typically 0.25% to 0.50% lower than conventional loans. Your mortgage payment will be lower because you avoid PMI entirely.
Who Qualifies
Key Benefits
VA Funding Fee
VA loans charge a one-time funding fee of 2.15% for first-time users (3.3% for subsequent use). On a $300,000 home, that is $6,450. This fee can be rolled into the loan so you pay nothing upfront. Veterans with service-connected disabilities are exempt. Learn more about VA loan requirements.
USDA Loans: 0% Down in Rural Areas
The USDA loan is one of the most underused zero-down-payment mortgage programs available. Backed by the U.S. Department of Agriculture, it helps buyers in eligible rural and suburban areas become homeowners without a down payment.
Many buyers assume "rural" means farmland, but the USDA eligibility map includes suburbs and small towns near major cities. About 97% of the U.S. land area qualifies, covering roughly one-third of the population.
USDA Loan Requirements at a Glance
Income Limits
Household income cannot exceed 115% of the area median income. For a family of four, the limit ranges from approximately $103,500 to $238,000+ depending on location.
Property Location
The home must be in a USDA-eligible area. Use the USDA property eligibility map at rd.usda.gov to check any address.
Guarantee Fees
1% upfront fee (financed into the loan) plus 0.35% annual fee. On a $250,000 loan, the annual fee is $875 per year or about $73 per month.
Occupancy
Must be your primary residence. Investment properties and vacation homes do not qualify for USDA financing.
FHA Loans: 3.5% Down
FHA loans are the most popular low-down-payment option for first-time home buyers. While not technically zero down, the 3.5% minimum can often be covered by down payment assistance programs or gift funds, effectively making it a no-money-out-of-pocket purchase.
Down payment with 580+ credit score
Down payment with 500–579 credit score
2026 FHA loan limit (most counties)
The main downside of FHA loans is the mortgage insurance premium (MIP). You pay 1.75% upfront (usually rolled into the loan) plus 0.55% annually for the life of the loan if you put less than 10% down. On a $300,000 loan, that adds roughly $137 per month. Review our complete FHA loan requirements guide for full details.
Conventional Low-Down-Payment Options
Even if you do not qualify for VA or USDA loans, conventional loans offer several 3%-down programs for first-time buyers. These programs have a significant advantage over FHA loans: the private mortgage insurance (PMI) can be removed once you reach 20% equity.
Fannie Mae HomeReady
Requires just 3% down with reduced PMI costs. Borrowers must earn at or below 80% of the area median income. Allows non-occupant co-borrowers and boarder income to help qualify. One of the most flexible programs for low-to-moderate-income buyers.
Freddie Mac Home Possible
Similar to HomeReady with 3% down and income limits at 80% AMI. Allows sweat equity and co-borrower income. Offers lower PMI rates compared to standard conventional loans and flexible sources for down payment funds.
Conventional 97
The standard 3%-down conventional loan. At least one borrower must be a first-time home buyer. No income limits apply. PMI is required until you reach 20% equity, at which point you can request its removal. Check our conventional loan requirements for details.
Down Payment Assistance Programs
Down payment assistance (DPA) programs can turn any low-down-payment loan into an effective no-money-down purchase. Over 2,000 programs exist across the United States, and billions of dollars in assistance go unclaimed every year because buyers simply do not know about them.
Grants
Free money that never needs to be repaid. Many state housing agencies and local governments offer grants of $5,000 to $25,000 for first-time buyers. These are the most valuable form of DPA.
Forgivable Loans
Second mortgages that are forgiven after you live in the home for a set period, usually 5 to 15 years. If you move before the forgiveness period ends, you repay a prorated amount.
Deferred Loans
No-interest or low-interest second mortgages with payments deferred until you sell, refinance, or pay off your first mortgage. These help you buy now and pay later when you have more equity.
How to Find DPA Programs in Your Area
Start with your state housing finance agency. Every state has one, and they administer most DPA programs. Your real estate agent and mortgage lender should also know about local programs. Check our state-by-state DPA directory for links to programs in all 50 states.
Monthly Payment Comparison: 0% vs 3.5% vs 20% Down
How much more does a no-money-down mortgage actually cost each month? Here is a real comparison based on a $350,000 home at a 6.5% interest rate in 2026.
| Detail | VA Loan (0%) | FHA (3.5%) | Conventional (20%) |
|---|---|---|---|
| Down Payment | $0 | $12,250 | $70,000 |
| Loan Amount | $350,000 | $337,750 | $280,000 |
| Principal & Interest | $2,212 | $2,135 | $1,770 |
| PMI/MIP | $0 | $155/mo | $0 |
| Property Tax (est.) | $292 | $292 | $292 |
| Insurance (est.) | $150 | $150 | $150 |
| Total Monthly Payment | $2,654 | $2,732 | $2,212 |
| Cash Needed Upfront | $0 down | $12,250 down | $70,000 down |
Estimates based on 30-year fixed rate at 6.5%. Property tax assumed at 1% of home value. Actual rates and costs will vary by lender and location.
What This Means
A VA zero-down mortgage on a $350,000 home costs about $442 more per month than putting a 20 percent down payment. But it saves you from needing $70,000 in cash. The costs of buying a home are real, but the extra monthly cost is far less than what you would pay in rent while trying to save that amount. For most buyers, that tradeoff is well worth it.
Using Gift Money and Seller Concessions
Two additional strategies can reduce your out-of-pocket costs to virtually zero, even on loan types that require a small down payment.
Gift Funds
All major loan programs accept gift funds for your down payment. The gift must come from an eligible source.
Seller Concessions
The seller can agree to pay a portion of your closing costs. Maximum concessions vary by loan type.
How a Real Estate Agent Helps With Zero-Down Purchases
A knowledgeable real estate agent is especially valuable when you are buying with no money down. Here is what they bring to the table.
DPA Program Knowledge
Experienced agents know which local and state assistance programs you qualify for. They can connect you with lenders who specialize in zero-down and low-down-payment loans.
Seller Concession Negotiation
Your agent can negotiate seller-paid closing costs as part of your offer. This is standard practice, and a skilled negotiator can save you thousands at closing.
USDA Area Expertise
If you are considering a USDA loan, an agent familiar with eligible areas can find homes that qualify without you having to check every address individually.
Lender Referrals
Not all lenders offer all loan types. Your agent can refer you to lenders experienced with VA, USDA, and DPA programs, ensuring a smoother process from application to closing.
Frequently Asked Questions
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 veterans, active-duty service members, and surviving spouses. USDA loans are for buyers in eligible rural and suburban areas who meet income limits. Both let you finance 100% of the purchase price.
What credit score do I need to buy a house with no money down?
For VA loans, most lenders require 580 to 620. For USDA loans, the minimum is typically 640. FHA loans need 580 for a 3.5% down payment. Conventional programs like HomeReady and Home Possible require 620. Check our guide on credit scores needed to buy a house for details.
Do I still need to pay closing costs with a zero-down mortgage?
Yes. Closing costs typically range from 2% to 5% of the purchase price. On a $300,000 home, that is $6,000 to $15,000. However, you can use seller concessions, lender credits, or DPA programs to cover some or all of these costs.
What is the difference between a VA loan and a USDA loan?
Both are zero-down government-backed loans. VA loans serve veterans and military members with no geographic restrictions and no PMI. USDA loans serve any income-eligible buyer purchasing in a USDA-designated rural or suburban area, with a 0.35% annual guarantee fee.
Is it smart to buy a house with no down payment?
It can be smart if you have stable income and manageable debt. The tradeoff is higher monthly payments and less starting equity. But building equity through homeownership beats paying rent long-term, even with zero down.
What are down payment assistance programs?
DPA programs are grants, forgivable loans, or deferred-payment loans from state and local governments, nonprofits, and employers. Over 2,000 programs exist nationwide. Many go unused because buyers do not know they exist. Check our complete DPA guide.
Can I use gift money for a down payment?
Yes. FHA, VA, USDA, and conventional loans all accept gift funds. The gift must come from an eligible source like a family member, and you need a signed gift letter confirming the funds are a gift and not a loan.
Do I have to pay PMI with no money down?
VA loans never require PMI. USDA loans have a 0.35% annual guarantee fee instead. FHA loans require MIP for the life of the loan with less than 10% down. Conventional loans require PMI until you reach 20% equity. Learn more about PMI and how it works.
Ready to Buy With No Money Down?
Connect with a real estate agent who specializes in zero-down and low-down-payment home purchases. They will help you find the right loan program and DPA assistance for your situation.
Find My AgentRelated Home Buying Guides
Understanding your mortgage options is just the first step. A mortgage is a home loan that lets you buy homes by paying over time. These guides cover every way to buy a house and will help you through the rest of the home buying journey. No-down payment mortgages allow you to buy a home even without a sizable down payment saved.
Explore our detailed guides on VA loans, FHA loans, and USDA loan requirements. If you have not saved enough for a down payment in any form of down payment, these programs can help. Check how much house you can afford before shopping for a home.
Take the first step by reading our step-by-step home buying process. And check our zero-down-payment home loans guide for even more detail on no-money-down options.