How to Buy a House With Bad Credit & No Down Payment

Even with bad credit, you can still get approved for your dream home.

You probably want to own a home at least once in your life time, but if you have bad credit and no money for the down payment, you might give up on your dream. Fortunately, there are options available for people who don't have perfect credit or money for a down payment.

Step 1

Apply for a Federal Housing Administration loan. These loans aren't hard to qualify for even if you have bad credit, according to the Federal Housing Administration. The Federal Housing Administration insures the loan so lenders will offer you a good deal on the mortgage. To apply, go to the Federal Housing Administration Lender List.

Step 2

Apply for secondary financing. This is how you'll get rid of the down payment. You'll need to use secondary financing in conjunction with a Federal Housing Administration loan. You can get nonprofit government down payment assistance, government entity down payment assistance, or down payment assistance from charitable organizations. To apply for these programs, visit the U.S. Department of Housing and Urban Development: Down Payment Assistance Through Secondary Finance Providers.

Step 3

Research your state's home buying programs. In addition to the Federal Housing Administration loan program, there may be other programs in your state that will help you buy a house with bad credit and no down payment. Visit the U.S. Department of Housing and Urban Development: Local Homebuying Programs.

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