100% Financing Loans or
no down payment loans is a recent concept fuelled by
real estate boom making it possible to avail hundred
percent cost of home as loan without the requirement
of any down payment. With a good credit rating, the borrowers
can avail themselves of 100% mortgage financing with
ease. Your credit rating need not be “perfect” yet
it should be sufficient enough to get a 100% financing
loan. Different lenders have different criterion for
disbursing 100% mortgage finance. The rule is better
the credit rating, more chances of getting 100% financing
loan from the prime lenders.
Normally, a 100% financing loan carries slightly higher
rate of interest. However, increasing competition among
the financial institutions has led to a sharp decline
in the interest rates. Don’t be surprised if you
can get near-market interest rates for 100% financing
loans as well.
Generally, two options are available for the borrowers
when obtaining 100% financing loans. The first is Private
Mortgage Insurance, or PMI, option. The borrowers are
required to carry a PMI, which varies in cost depending
on the size of the mortgage loan. PMI must be carried
until enough equity has built in the home or until you
can prove that you are capable of making payments in
a timely manner. The second is 80/20 option, which allows
you to take out two loans - the first one covers 80%
of the amount required for home purchase, and the second
acts as a 20% down payment.
As with any kind of loan, 100% financing loan should
also be availed only after going through different financial
solutions available with different lenders. A thorough
research will leave you in a good stead for making an
informed decision.
We support the borrowers with less than “perfect” credit
rating by offering 100% financing loans at attractive
rates of interest.
*Please note: This information
is only for general use only and may not apply with Stubbs
Finance's terms and policies. Please speak to Stubbs
finance for all information regarding your loan and
loan advice.
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