My experience!

Amidst the subprime lending crisis, a glimmer of hope arises for people who wanted to buy a house but don’t have the money for the down payment. The asset-challenged borrowers can opt for no money down mortgage.

Basically, this type of mortgage allows people to finance 100 percent of the property they want to acquire. Application process is somewhat similar to those of standard mortgages. All you need to do is submit necessary information which may include your assets, credit report, and income. Once you have met all the requirements, the lender can now pre-approve you. Please note that additional documents may be required prior to the approval of the application. A no money down mortgage can have a lot of advantages. First, it can help you buy a property quicker – even if the house prices go up. As you have secured the purchase, any rise in house prices can turn into equity. Second, and perhaps the main reason why some people choose this type of mortgage, it allows them to have financial flexibility. The property buyer can use what money he or she has for other things – to pay other debts, to pay for moving costs or to buy new appliances – while securing the purchase of the house.

But there is also some risks in no money down mortgage. Since there are no down payments made, expect higher monthly mortgage payments. Aside from that, other lenders would require you to have a private mortgage insurance which is included in the monthly payment.