In the past, lenders have required at least 20% down payment on a Wisconsin or Illinois home loan. However, government mortgage programs only require you to put 3.5% down, or even 0% down in certain geographical areas of the Wisconsin and Illinois or if you are a veteran.

FHA Mortgage: 3.5% down payment
USDA Rural Housing: No Money Down
VA Mortgage: No Money Down

How Can I Buy With No Money Out of My Own Pocket with FHA?

FHA loans allow your down payment and closing costs to be a gift. This means if Mom or Dad, or other family members are willing to put up the money for your down payment and closing costs, you could potentially come to the closing table with none of your own money. As long as you can qualify for the loan and can make the monthly payments, gift money is ok.

What if I Don't Have Any Family Members Willing to Give Me Money to Buy a Home?

As a first time home buyer, if you purchase a home before December 1, 2009, you qualify for an $8,000 tax credit from the federal government. Also, with most government loan programs, sellers are allowed to contribute up to 6% of the purchase price towards closing costs as well.

How do I know if I qualify for a USDA Rural Housing Loan?

The first thing I would check is your eligible income. Depending on your family size, USDA Rural Housing loans have income limits. Secondly, you will want to check to see where you plan to purchase is Rural Housing eligible. There are geographical restrictions on these loans.

I've Heard You Need Cash Reserves to Qualify

Not always. Certain loan programs do not require cash reserves. Before, lenders required you had a few months cash reserves in the bank so you could still make your mortgage payment if you lost your job. Now, there are programs available that will allow you to spend every last penny in your bank account in order to close the loan, although we don't recommend you do that.

How Can I Find Out How Much I Can Afford?

To find out how much you can afford, send me an email, fill out one of our many online applications or give us a call. I will evaluate your financial situation and show you what you can afford with no obligation or commitment.

Dennis Hardy
Toll Free: (877) 240-5810 x104
dennis.hardy@madisonmortgageguys.com
www.madisonmortgageguys.com

Visit my blog at http://www.madisonmortgageguys.com/blog/

First Time Home Buyer Information for Illinois and Wisconsin Residents

http://www.madisonmortgageguys.com/blog/content/first-time-home-buyer-information-for-illinois-and-wisconsin-residents-2/