Home buying with ZERO DOWN

Real Estate Finance, old is coming back
According to Paul E Skeens, Owner of the Carteret Mortgage Crop. " we are headed back to a more normal cycle" after the feeding frenzies of the boom years " The crazy stuff may be gone but the old solutions still work great"
For example, for the home buyers with limited cash on hand and low credit who might have signed for a zero down Sub - Prime Mortgage two years ago , there is a program available nationwide through mortgage investor "Freddie- mac"
Freddie Mac:
Also known as Federal Home Loan Mortgage Corporation (FHLMC) is a stockholder owned corporation charted by congress in 1970 to stabilize the mortgage market and support homeownership and affordable rental housing. This mission is accomplished by linking Main Street to Wall Street Purchasing, scrutinizing and investing in home mortgages and ultimately providing home owners and renters with lower housing costs and better access to home financing. Since its inception, Freddie Mac has financed one out of every six homes in USA.

Now a days its called Home Possible and comes in several variations including ZERO DOWN PAYMENT "homes possible 100" The program allows seller contribution of up to 3% of the total costs and does not require any set amount of financial reserves by borrower. The maximum loan amount is now a days $417,000
As i said in the beginning that "old is coming back" as Freddie Mac only requires applicants to qualify through its traditional "loan Prospector" automated under writing system.
This means that borrowers generally need FICO score 620 or higher and must be prepared to verify income and employment.
For applicants with non traditional credit histories that cause them to have artificially depressed credit scores, Freddie Mac will accept old fashioned "manual" under writing as well as look at non traditional credit records such as rent payments histories and utility payments. A key feature for young first time buyers with slim credit files, as well as minorities and immigrants with little banking experience.

There is another good news, If congress passes pending legislation allowing ZERO DOWN Payments and 40 YEARS TERMS, there will be so many FHA loans available for home buyers.
Currently FHA requires 3% down payments, as well as employment, income and asset verification. Unlike sub-prime loan, they come with lower rates and prepayments penalties.
There is another time tested technique coming back, where sellers subsidize the rate on the buyers' mortgages for the first two or three years in exchange for an upfront payment by the seller to the lender.
The underlying mortgage can take almost any form

• Fixed rate
• adjustable
  
• interest only
• hybrid

But the net result is the same:
Loan rate is reduced to a more affordable level for a period of years as a concession to buyer

Now another good thing in todays market: seller "takes- back" or "Carry-backs" A mainstay of creative financing toolbox during the hyper inflationary periods of 1980's when conventional mortgages for buyers with good credit topped over 15%- Seller takes backs are simply deferred payments notes offered by sellers on attractive terms to help buyers swing the deal.
Properly structured and documented by experienced attorneys or investors, take-back notes are readily saleable for cash in the private secondary note market.
Sellers can also hold on to them win win investments, pocketing steady income.
So now a days the words in advertisements by real estate agents, buy with zero down, I have tried explaining. If you have any question please feel free to ask.