No money · Honest guide
How to Buy a House With No Money
It’s legal, it’s routine, and VA and USDA buyers do it every day: purchases with $0 down and almost nothing at the closing table. No gurus, no schemes — just five layers of programs the industry rarely explains together: 0%-down loans, down payment assistance, seller concessions, lender credits, and gift funds. This guide shows how to stack them, what the honest trade-offs are, and the roughly $1,000–$3,000 that no program on earth eliminates.
Last updated July 2026
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Buying with no money, the short version
First, the two problems people confuse: no money DOWN and no money AT ALL. The down payment is one bucket. Closing costs, prepaids, earnest money, inspection and appraisal are others. Each bucket has its own solutions, and you have to attack them deliberately — which is exactly what this guide does.
The stack has five layers: (1) a 0%-down loan (VA, USDA, or a credit-union product) — or a 3–3.5% loan whose down payment is covered by (2) down payment assistance; (3) seller concessions of 3–9% to cover closing costs; (4) lender credits; and (5) gift funds. Combined correctly and legally, they can drive your cash to close to nearly zero.
Two honest warnings up front. “No money” never means “no financial requirements” — you still need qualifying income, workable credit, and debt-to-income headroom. And there’s an irreducible cash floor of roughly $1,000–$3,000 (earnest money, inspection, appraisal) that essentially nothing eliminates. Anyone promising otherwise is selling you something.
The facts
Is it actually possible? Yes — here’s the proof
Zero-down buying is a meaningful slice of the market, not a loophole. What it isn’t is requirement-free.
The VA guaranteed 528,340 loans in fiscal 2025 — hundreds of thousands of them purchases with nothing down. VA loans alone account for roughly 10.6% of home-purchase originations. Add USDA’s 100% financing and the roughly 2,000 actively funded assistance programs covering down payments on FHA and conventional loans, and near-$0 purchases happen every business day. Meanwhile NAR’s data shows the median first-time buyer puts down 10% — evidence most buyers aren’t using the options available to them.
The three requirements that never disappear
Income that fits the debt-to-income limits (see our income and affordability guide). Credit — typically a 580–620 floor for FHA, VA and USDA, and 620–660 for most assistance programs. And DTI headroom — here’s the number that reframes everything: per the Urban Institute, 36.7% of mortgage denials are for high DTI versus just 5.7% for insufficient cash. Income and debt sink six times more applications than money does. If your ratios are stretched, fixing them matters more than any no-money strategy.
⚠️ The irreducible cash floor: ~$1,000–$3,000
Three things must be paid early, in cash, and essentially can’t be financed or covered by concessions: earnest money (typically 1–3% of the price — but it’s credited back to you at closing, so it’s cash you need, not cash you lose), the home inspection (~$300–$550, paid at the time of service), and the appraisal (~$350–$800; VA and USDA appraisals run toward the top). Appraisal waivers exist on some conventional loans but never on FHA, VA or USDA — the very loans no-money buyers use. Budget the floor, plus moving costs, and be suspicious of anyone who claims it doesn’t exist.
Layer 1
The 0%-down loans
Two federal programs finance 100% by statute. Several lender products get you there too.
The federal heavyweights
VA — 0% down, no monthly mortgage insurance, for veterans, active-duty service members and eligible surviving spouses. The trade-off is a one-time funding fee — 2.15% first use, 3.3% after — which can be financed into the loan, and which is waived entirely for veterans with a 10%+ disability rating, Purple Heart recipients on active duty, and surviving spouses receiving DIC. With full entitlement there’s no loan limit. Full details in our VA loan guide.
USDA Guaranteed — 0% down in eligible areas (roughly 97% of U.S. land area, including plenty of suburbs). Household income capped at 115% of area median — about $119,850 for a 1–4 person household in most areas in 2026. Fees: 1% upfront (financeable) plus 0.35% annually — notably cheaper than FHA’s mortgage insurance. Most lenders want a 640 score.
USDA Direct 502 — the best-kept secret in American housing. For low and very-low income buyers in eligible areas, USDA itself lends with a payment subsidy that can cut the effective rate to as low as 1%, terms up to 38 years, and no down payment. The subsidy is recaptured when you sell — but for qualifying families it’s unmatched.
Also: HUD’s Section 184 program (1.25–2.25% down for enrolled members of federally recognized tribes) and the VA’s Native American Direct Loan (0% down on trust land).
The lender-made paths
Physician and professional loans: dozens of banks offer 0–10% down with no PMI for doctors, dentists, and often veterinarians, PAs, CRNAs, pharmacists and attorneys — with friendly treatment of student debt. Rates run about 0.125–0.50% above conventional; for high-future-income professionals that’s usually cheaper than PMI.
Credit-union 100% financing: Navy Federal’s Homebuyers Choice and Military Choice offer zero down with no PMI (a financeable 1.75% funding fee applies), and Military Choice even allows seller contributions up to 7%. Other credit unions offer similar member-only portfolio products.
Conventional 1%-down programs: products like Rocket’s ONE+ have you put 1% down while the lender grants 2% to reach the conventional 3% minimum, with no PMI — limited to incomes at or below 80% of area median. (Beware stale articles: some heavily promoted 0%-down conventional programs from 2023–2024 have since been discontinued. Verify anything you read — including this — with the lender.)
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Layer 2
Down payment assistance: 2,679 programs, mostly ignored
The median benefit is $16,862. Seventy percent of Americans don’t know it exists in their neighborhood.
As of early 2026 there are 2,679 homebuyer assistance programs nationwide — 2,073 actively funded, 1,993 providing down payment or closing-cost help. The Urban Institute found 43.6% of buyers in the 10 largest metros were potentially eligible, with a median benefit of $16,862 — yet a NeighborWorks survey found 70% of U.S. adults don’t know assistance exists where they live. This is the largest pile of unclaimed money in home buying.
Know which of the four structures you’re getting
Grants — never repaid (about 8% of programs). Forgivable seconds — a silent second mortgage forgiven after you occupy the home for a set period, often 3–5 years. Deferred “silent” seconds — no monthly payment, but repaid in full when you sell or refinance. Repayable seconds — a real second loan with a monthly payment at low or 0% interest. Second mortgages dominate (56% of all programs), and the structure matters enormously: a deferred second sitting on your title complicates future refinancing, and a shared-appreciation program takes a cut of your gains.
Typical eligibility: income limits of 80–140% of area median (and 11% of programs have no income limit at all), a first-time-buyer requirement in about 62% (defined as not owning in the past 3 years), a homebuyer education course, and 620–660 credit. Find yours through your state’s Housing Finance Agency via our state guides.
Programs worth knowing by name
Good Neighbor Next Door (HUD): teachers, law enforcement, firefighters and EMTs buy eligible HUD-owned homes in revitalization areas at 50% off list price — with FHA financing, the down payment can be $100. The discount is a silent second forgiven after 36 months of occupancy. Limited inventory and lottery selection, but nothing else comes close.
Florida Hometown Heroes: up to $35,000 as a 0%-interest deferred second for 50+ frontline occupations, income up to 150% AMI — relaunching July 13, 2026 with $50 million, first come, first served. A pattern worth learning: state programs run out. Apply early in the fiscal year.
Chenoa Fund: nationwide (except NY) 3.5–5% assistance on FHA loans — forgivable after 36 on-time payments, or repayable over 10 years with no income limit. It never runs out of funds, making it the reliable fallback.
CalHFA Dream For All: up to 20% of the price ($150,000 max) as shared appreciation for first-generation California buyers — allocated by lottery because demand crushes supply every round. You repay the loan plus a share of your appreciation.
NACA: no down payment, no closing costs, no PMI, no minimum credit score, below-market rate — legitimately, via a $15 billion Bank of America commitment and 75,000+ mortgages with a near-zero foreclosure rate. The price is process: months of mandatory counseling and savings requirements. Arguably America’s best mortgage for those who can endure the paperwork.
Layers 3, 4 and 5
Covering closing costs with no cash
The down payment was one bucket. Here’s how the other bucket gets to zero.
Closing costs run 2–5% of the price on top of any down payment. Three tools cover them — and in 2026’s balanced market (4.6 months of inventory), sellers actually say yes.
💰 Seller concessions: the legal caps
Conventional: 3% with less than 10% down, 6% with 10–25%, 9% above 25%. FHA: 6%. USDA: 6%. VA — the most generous by far: sellers can pay all customary closing costs with no limit, plus up to 4% in concessions covering prepaids, the funding fee, even paying off your debts. Concessions can cover closing costs, prepaid taxes and insurance, and escrow reserves — they cannot fund the down payment, and you can’t take cash back beyond actual costs.
Lender credits add another layer: a slightly higher rate in exchange for the lender paying costs. And the government loans’ upfront fees — FHA’s 1.75%, the VA funding fee, USDA’s 1% — all roll into the loan rather than needing cash.
Gift funds: the family layer
On a conventional loan for a one-unit primary residence, 100% of the down payment and closing costs can be gifted — no minimum from your own pocket. FHA accepts an even broader donor list (employers, unions, charities, documented close friends). Every gift needs a signed gift letter stating no repayment is expected, plus a paper trail — and here’s the hard line: a family loan dressed up as a gift is mortgage fraud. If it must be repaid, it counts in your DTI and must be disclosed.
Buying from family? Use a gift of equity. If your parents sell you their $350,000 house for $315,000, that $35,000 difference is your down payment — 10% down without a dollar moving. It takes an appraisal and a gift letter, and with the 2026 lifetime gift-tax exemption at $15 million per person, most families owe no tax (the donor may just file a form). One limit: a gift of equity can’t count as your reserves.
The other paths
Creative routes: the good, the conditional, and the dangerous
This corner of the internet is guru territory. Here’s each path judged on evidence.
✅ Worth real consideration
Assumable mortgages: every FHA, VA and USDA loan is assumable with lender approval — meaning you can inherit a 2.5–3.5% rate from a 2020–2021 loan. The catch that kills most deals: you assume only the balance, so you must pay the seller their equity in cash or a second loan. A $475,000 home with a $290,000 assumable balance needs $185,000 to bridge the gap. It’s a brilliant interest-rate play, not a no-money play. (Sellers beware too: a non-veteran assuming a VA loan ties up the veteran’s entitlement until payoff.)
House hacking with VA: buy up to 4 units with 0% down, live in one, and let rent cover the payment — the single most powerful wealth move available to eligible veterans.
Co-buying with family or friends splits every cost, with a co-ownership agreement in writing. A 401(k) loan isn’t “no money,” but it’s no new money — you borrow up to $50,000 from yourself, with real risks if you change jobs.
🚨 Approach with a lawyer — or don’t approach
Seller financing is legitimate but needs careful legal structure (Dodd-Frank limits apply, and balloon payments are common). Rent-to-own / lease-options fail most of the people who try them: at large operators studied by the National Consumer Law Center, roughly half of tenants left with nothing and only about 14% ever bought — option fees and rent credits forfeited. Contracts for deed are worse: the CFPB’s 2024 report found them often “structured to fail,” targeting low-income and immigrant communities, with buyers losing everything over a single missed payment. “Subject-to” deals — taking over payments without lender approval — risk the due-on-sale clause being called. And any guru charging upfront fees to teach you “no money down secrets” is monetizing your desperation. The legal paths in this guide are free.
The real numbers
Four buyers, near-zero cash: the worked math
Actual stacks, actual payments at 6.49%, and the true cash each buyer needs.
The stacks in action
VA buyer, $350,000 home, 0% down — funding fee 2.15% ($7,525) financed → loan $357,525 · P&I ~$2,259/mo, no PMI · seller pays customary costs + 4% concessions covering prepaids · true cash: ~$1,000 (inspection + appraisal; earnest money credited back). With a 10%+ disability rating, the fee vanishes and P&I drops to ~$2,212.
FHA buyer, $300,000 home, 3.5% down paid by state DPA — forgivable second covers the $10,500 down payment · UFMIP financed → loan $294,566 · P&I ~$1,861 + ~$135 MIP · 6% seller concession ($18,000) covers closing costs, prepaids and escrows · true cash: ~$1,500–$2,500.
USDA buyer, $250,000 rural home, 0% down — 1% fee financed → loan $252,500 · P&I ~$1,595 + ~$74/mo annual fee · 6% concession covers the rest · true cash: ~$1,000–$2,000 (USDA appraisals run ~$775).
Conventional HomeReady, $300,000, 3% down via DPA — loan $291,000 · P&I ~$1,838 + cancellable PMI · 3% concession toward closing · true cash: ~$1,500–$3,000.
Every scenario needs moving costs on top — and should keep reserves beyond the floor.
⚠️ The honest trade-offs
You start underwater in practice. With 0% equity and 6–8% selling costs, your home must appreciate 7–8% before you could sell without writing a check — roughly two years at 4% appreciation. If you might move within two or three years, zero down is the wrong tool.
You pay more monthly and over time. Financing 100% instead of 80% means hundreds more per month plus mortgage insurance or funding fees — the full comparison is in our down payment guide, which also shows the counter-math: a few years of PMI (~$15,000–$20,000) is often far cheaper than $75,000 of missed appreciation while saving.
And no, this is not 2008. Today’s zero-down loans are fully documented, ability-to-repay verified, income-checked loans — the opposite of the no-doc lending that caused the crash. Zero down didn’t cause 2008; lending to people who couldn’t repay did. The underwater risk is yours to weigh; the systemic one isn’t there. The one rule that protects you from both: never close with $0 left in the bank. A house with no reserve fund is one broken furnace from crisis.
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Quick answers
Buying with no money: common questions
Can you really buy a house with no money?
Yes — legally and routinely. VA and USDA loans finance 100% of the price, down payment assistance covers the 3–3.5% on FHA and conventional loans, and seller concessions plus lender credits and gift funds cover closing costs. What you can’t escape: qualifying income, workable credit (typically 580–640+), and roughly $1,000–$3,000 in cash for earnest money, inspection and appraisal.
How do I buy with no money if I’m not a veteran?
Three main routes: USDA if your area qualifies and household income is under 115% of area median; an FHA or conventional 3% loan with the down payment covered by one of the ~2,000 funded assistance programs (median benefit: $16,862); or 100% gift funds on a conventional loan. Stack seller concessions on top for closing costs.
Does no money down mean no closing costs?
No — they’re separate problems. The down payment is solved by the loan program or assistance; closing costs (2–5% of the price) are solved by seller concessions (3–9% depending on program, and effectively unlimited customary costs on VA), lender credits, financed government fees, and gift funds. You have to attack both buckets deliberately.
What’s the absolute minimum cash I need?
Roughly $1,000–$3,000, plus moving costs: earnest money (1–3% of the price, but credited back at closing — cash you need, not cash you lose), the home inspection (~$300–$550), and the appraisal (~$350–$800, higher for VA and USDA). These are paid early and can’t be financed or covered by concessions.
Is down payment assistance free money?
Sometimes. About 8% of programs are true grants. Most (56%) are second mortgages: forgivable after a few years of occupancy, deferred until you sell or refinance, or repayable monthly at low interest. Always ask which structure you’re getting — a deferred second complicates refinancing, and shared-appreciation programs take a cut of your gains.
Can my parents pay for everything?
Nearly. On a conventional loan for a one-unit primary residence, 100% of the down payment and closing costs can be gifted, with a gift letter and paper trail. If you’re buying their house, a gift of equity — selling below appraised value — creates the down payment without any money moving. The one thing family money can’t legally be: a disguised loan.
Isn’t zero down what caused the 2008 crash?
No — undocumented lending did. The crash was driven by loans made without verifying income, jobs or assets. Today’s zero-down loans are fully documented and must pass the federal ability-to-repay rule; VA loans, all 0% down, have among the lowest foreclosure rates of any product. The real risk today is personal, not systemic: with no equity, you need 7–8% appreciation before you could sell without a loss.
Is rent-to-own a good way to buy with no money?
Usually not. At large operators studied by the National Consumer Law Center, roughly half of tenants left without buying and only about 14% ever purchased — forfeiting option fees and rent credits. Contracts for deed are worse; the CFPB found them often structured to fail. The programs in this guide are cheaper, safer, and actually end in ownership.
Can I just take over someone’s low-rate mortgage?
Sometimes — FHA, VA and USDA loans are assumable with lender approval, letting you inherit a 2020–2021 rate. But you assume only the remaining balance, so you must pay the seller’s equity — often six figures — in cash or a second loan at today’s rates. It’s a great interest-rate strategy for buyers who have money, not a no-money strategy. Informal “subject-to” takeovers without lender approval risk the loan being called due.