Down payment assistance

Down Payment Assistance and Zero Down Mortgages

A lot of Americans feel like homeownership isn’t realistically in the cards for them. After all, there are a lot of standards they need to meet to qualify for a home loan – They need to have enough in savings, they need to have a good credit score, and they need a massive down payment. Or… do they?

Believe it or not, there are a lot of different programs that can provide down payment assistance and certain loan types that provide 100% financing and require no down payment.

How do Down Payment Assistance Programs Work?

Most down payment assistance programs are structured as either a grant or a second mortgage.

A grant is “free money” that generally doesn’t need to be repaid, while a second mortgage will need to be repaid just like your primary home loan. The good news is that most second mortgages have much lower interest rates than traditional loans or credit cards.

There are a lot of state and local programs that offer down payment assistance, but the rules and regulations can vary greatly depending on the program requirements. Some programs may only be available to first-time home buyers, while others might be open to any qualified buyer.

Similarly, the amount of money offered will also differ from one program to the next. In some cases, you might only be able to get a few thousand dollars, while other programs could offer tens of thousands.

What Down Payment Assistance Programs are Available?

There are a couple of different varieties of down payment assistance programs. As we mentioned before, most of these have qualifying factors like being a first-time homebuyer or the loan amount. However, there are some other important factors like the state you live in and what your profession is.

State-Specific Down Payment Assistance Programs

Some of the most generous down payment assistance programs are offered on a state level. These include programs like:

  • Utah Housing Corporation Loan Programs - Provides multiple program options that can provide home financing, down payment and closing cost assistance, reasonable interest rates, and may have lower fees than other loans.

  • CalHFA Loan Programs - The CalHFA Single Family Division provides low-interest home financing as well as down payment and closing cost assistance for homebuyers in California.

  • IHFA Home Loans - The Idaho Housing and Finance Association strives to provide funding for affordable housing opportunities in Idaho communities. With multiple home financing and down payment assistance programs available these loans are a great option for Idaho residents hoping to purchase a single-family home, condo, or townhouse.

  • More State-Specific Loan Programs can be found on our Loan Programs page.

Profession-Focused Loan Programs

Some loan programs like the IHFA Heroes Loan Program or the Utah First-Time Homebuyer Law Enforcement Grant are not only state-specific but also require

you to work in relevant professional fields.

For example, the IHFA Heroes Loan Program offers home financing as well as down payment and closing cost assistance to Idaho’s medical professionals, firefighters, law enforcement officers, paramedics, teachers, retail workers, and military personnel.

These programs are a great way for Veritas Funding and state financing associations to give back to first responders and heroes. These professions certainly deserve a solid thank you and a place to call home.

Happy homebuying Couple
Happy homebuying Couple

How Do Zero Down Mortgage Programs Work?

A zero down mortgage is pretty much exactly what it sounds like – a home loan that requires no money down.

The USDA Rural Development Loan is one of the most well-known zero down mortgage programs, but there are other options available as well.

These types of loans are typically reserved for people with good credit and a stable income, as they’re considered to be higher risk. As such, the interest rates on these loans are often higher than your typical home loan.

What Zero Down Programs are Available?

VA Loan

Backed by the Department of Veterans Affairs, VA Loans specifically help active-duty service members, certain qualified veterans, and even some members of the National Guard and Reserves to purchase homes.

VA Loans don’t have the high credit requirements than Conventional Loans do, and they also don’t require qualified families to pay a down payment. Additionally, VA loans don’t require borrowers to pay mortgage insurance either.

Instead, VA borrowers will have to pay a one-time funding fee (which can be split up and rolled into monthly mortgage payments) dependent on the size of the loan, the number of years of service in the military, and other factors.


Another common zero-down option is a USDA Loan. USDA Loans are backed by The US Department of Agriculture and are a good opportunity for those looking to buy a home in a more rural area.

The USDA encourages buyers to build or buy homes in less developed areas by offering a no down payment option as well as a lower interest rate. To qualify for a USDA Loan you must:

  • Plan to live in the home full time

  • Have a low to moderate steady income

  • Have no delinquencies on an outstanding loan or federal debt.

Depending on where you’re looking to live, there may be some loan limits as well as size requirements, too.

Chenoa Fund Down Payment Assistance

If you don’t meet the requirements for a VA or USDA Loan, another option is to look into is Chenoa Fund Down Payment Assistance Programs. Used in conjunction with Conventional and FHA Loans, these federally chartered programs are a great add-on that helps buyers get into homes when they otherwise may not be able to.

Dependent on the specific program, the down payment from Chenoa may be forgivable or require repayment, but borrowers must meet certain requirements (such as meeting a minimum credit score) to qualify.

Family Moving In
Family Moving In

Are you Eligible for Down Payment Assistance?

While putting a larger down payment down on a home might help you save money in the long run, it’s not realistic for everyone, and that’s okay.

There are plenty of options when it comes to buying a house, and you shouldn’t turn away from homeownership just because you don’t have a ton of money saved in the bank.

To learn more about buying a home without a down payment or discover what zero-down programs you may be eligible for, send us an email or give us a call today.