Low or no down payment? How to avoid getting dinged on mortgage fees

by. Gina Ragusa

Although the mortgage rule of thumb for down payments is typically at least 20%, you can still obtain a mortgage with as little as 3.5% down.

Following the recessionary smack down, many consumers don’t have that pot of gold brewing in their bank account so finding extra cash for a real estate down payment may be difficult.

Of course lenders and the Federal Housing Administration don’t want you to be completely discouraged, which is why a number of special low down payment programs are offered.

While programs are readily available, what will it cost you? Can you obtain the same rate and terms on a mortgage as someone who was able to meet that 20% down payment number?

The short answer is no. Lenders must be covered for risk and riskier borrowers typically can only afford to put down less cash.

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