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Conventional 1 Percent Down Mortgage
Riverbank Finance LLC is pleased to offer the Conventional 1% Down Mortgage with Equity Boost home loan program. In this program, you can purchase a home with 3% equity, but only 1% down payment. How does that work? You, the buyer, contribute 1% and we, your lender, contribute up to 2% (Maximum of $4000) giving you a total of 3% equity at close.
Not only does it help make homeownership more affordable for borrowers, it gives you a competitive edge when talking to real estate agents.
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History of the Conventional 1% Down Home Loan
The 1% down mortgage program is an extension of the current 3% down home loans. This program emerged in 2016 as an expansion of the Home Possible Advantage 3% down mortgage program. Currently this program is only available through Freddie Mac as part of its efforts to make homes afforable to new buyers. This new loan options allows you to purchase a home for as little as one month’s rent. Why pay a landlord when you can invest in your own property?
See our new Conventional Mortgage Calculator to estimate payments!
For more information on a Low Down Payment Conventional Mortgage, call 1-800-555-2098 or apply online today!
Conventional 1% Down Home Loan Rates
Mortgage rates for the Conventional 1% Down Mortgage Rates are very competitive. Mortgage rates are near their lowest in history, so it is a great time to purchase! Even more exciting is that we are able to offer this program with no monthly mortgage insurance (PMI). This combination of a low down payment, low mortgage rate, and no monthly mortgage insurance option makes it an unbeatable way to purchase a home!
1% Down Home Loan Requirements
As with any mortgage, there are restrictions and qualifications for eligibility. Borrower(s) must meet all conventional home loan requirements for credit score, income and the subject property. Below are a few program specific requirements:
Guidelines and Requirements for the 1% Down Home Loan
To be eligible for the 1% down home loan you must meet the standard Conventional Mortgage guidelines. Debt-to-income ratios must be in line, the property must meet minimum standards and your credit must be acceptable to be approved for Conventional Financing.
Low Down Payment Mortgage Comparison
There are several low down payment mortgage options available including the 1% down mortgage, USDA Rural Development mortgage, and the VA loan for military veterans. The biggest difference between these loan options are that USDA and VA loans are both backed by the government and have additional restrictions to qualify. The 1% Down Conventional Mortgage is a mortgage program that may allow you to avoid borrower paid PMI and drop the PMI in the future if you have it on your loan.
With 1% down loan you end up with 3% equity at the time of the purchase which is an extra bonus! The USDA Mortgage and VA loan are both zero down loans that have an insurance fee or guarantee fee added to what you borrower. Lets use a $100,000 purchase as an example: With a 1% down Conventional Mortgage you will end up with a $97,000 loan amount. With the USDA loan you will start with a $101,350 loan amount and with a VA loan you would start with a $102,150 loan amount. If you can come up with the $1000 required in this example, which can be a gift, you could potentially save thousands.
Disclaimer: Borrower contributes 1% down, lender contributes 2% of the loan amount up to $4000 for the down payment and the borrower is responsible for any difference to get the required 3% down. The principal and interest payment on a $200,000 30 year Fixed-Rate Loan at 6.499% and 97% loan-to-value (LTV) is $1264 with 0 points due at closing. The Annual Percentage Rate (APR) is 6.613%. The principal and interest payment does not include property taxes and home insurance premiums, which will result in a higher actual monthly payment. Rates current as of 04/14/2023.