100% Financing for No Money Down Purchases.  100% Purchase Programs are not as prevalent as they once were due to changes in mortgage regulations and economic factors. Some lenders do offer 100% programs, but they are few and far between. Still, there are other ways to purchase a home with limited or no down payment, such as grants and special programs from municipalities and non-profit agencies. Contact your trained loan officer for availability in your area.
100% Financing is when your loan officer secures a mortgage loan for you that is equal to the full purchase price of the home. In some circumstance, your loan officer could also arrange for you to receive more than 100% on a home purchase, providing you with extra money for closings costs and other fees that are often associated with a new loan.
Generally, for purchases the loan amount is capped at 103% or 107%. The extra 3-7% can be used for attorney fees, lender fees, appraisal fees, and sometimes can be used for origination fees. Applicants often have to prove they have access to some liquid reserves, they just don't have to use them in the transaction. If the loan is greater than 100%, seller concessions will probably not be allowed. Depending on the situation, it might make more sense to ask for seller concessions instead of getting a loan amount of greater than 100%.
Some lenders will raise your interest rate by .125 or more if you are getting over 100%.
Some lenders will make underwriting requirements a little more strict if you are getting a loan of over 100%.
Even with a loan amount of 103% or more, in some instances, there may be some costs and fees that the lender requires the borrower to pay. Your loan officer will work with you to try and reduce or eliminate as much of that out-of-pocket money as possible. Again, these loan programs are not as readily available as they once were. If you cannot find a 100% or Greater purchase program in your area, consider an FHA Loan where you can buy a home with as little as 3% down . FHA Loans also have the added benefit of lenient credit standards and generally low interest rates.
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