John and Candi just purchased a home for $178,000 with no down payment. They financed 100% of the purchase price. Their real estate broker negotiated a $5,000 closing costs credit paid by the seller of the property, thereby allowing them to move into their new home with just $1,327 cash at closing. They are among a growing group of buyers who are taking advantage of new, zero down payment home loans.

Zero down, 100% loans have been available to active duty military and military veterans since World War II. But buyers using conventional financing have traditionally been required to make down payments of 5% to 20%, until now.

Lenders are now offering conventional loans to everyone with no down payment. Zero down loans are especially popular among baby-boomers who prefer to keep their assets in higher returning investments like stock mutual funds or 401-K plans instead of sinking thousands of dollars into dead equity in their homes.

"Borrowers with good credit and modest savings are the target market for zero down home loans," according to Donna Ledger, Owner of  United Mortgage Corporation of America. "We're offering four different zero down loan options to our buyers at interest rates that compete with 5% and 10% down loans." "We have two loans that allow the seller to pay all the buyer's closing costs," Donna said.

A select group of lenders are currently offering 100% zero down loans and not all mortgage companies are making 100% loans. Some mortgage bankers are reluctant to offer 100% loans. Some banks will not acknowledge that such loans exist, preferring to offer the standard 10% and 20% loans.

Zero down loans will not work for all home buyers. Qualified buyers must have stable employment and excellent credit; late payments, judgments, or bankruptcy will disqualify any prospective borrowers.

The newest zero down home loans are loans above $240,000, a category of loans commonly referred to as "Jumbo" loans within the mortgage banking industry. "We've seen a lot of interest in zero down loans over $300,000," said Donna. "Buyers in this price range are savvy, experienced buyers. They are looking for the largest tax break they can get while keeping all of their assets working. Zero down jumbo loans allow higher income buyers to get the maximum tax break from owning an executive home, while keeping their cash in stocks, mutual funds, 401-K programs or other, more lucrative investments."

A consumer hot-line featuring a free recorded message has been set up to give you more information on zero down home loans at (541) 883-3421 extension 3009