# Can You Buy a House With No Money Down? 2026 Options
> Can you buy a house with no money down in 2026? VA and USDA loans go to $0. What FHA and 3%-down loans need, and the cash you'll still bring to closing.
Source: https://veteranhomematch.com/learn/buy-a-house-with-no-money-down
*Author:* VeteranHomeMatch Editorial Team
*Reviewed by:* VeteranHomeMatch Editorial Review
*Published:* 2026-11-02
*Updated:* 2026-11-02
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Yes, you can buy a house with no money down, but only two mainstream loan programs actually go to $0: the VA loan, for eligible veterans and service members, and the USDA guaranteed loan, for moderate-income buyers in eligible rural areas. Most of what gets sold as "no money down" is really low money down. FHA needs 3.5%, Fannie Mae's HomeReady needs 3%, and assistance programs or gifts can sometimes cover that slice for you. And on every one of them, $0 down still isn't $0 at closing.
- **VA and USDA guaranteed loans are the two mainstream $0-down options.** On a $350,000 home, that's $12,250 less in down payment than FHA's 3.5% minimum and $10,500 less than a 3% conventional loan.
- **VA has no monthly mortgage insurance.** It charges a one-time funding fee instead (2.15% on a first-use, $0-down purchase), which can be financed and is waived if you receive VA disability compensation.
- **USDA has two main eligibility gates** on top of its other requirements. Adjusted household income has to fall under USDA's moderate-income limit, and the home has to sit in an eligible area. USDA also charges a 0.35% annual fee for the life of the loan.
- **A seller can't pay your down payment,** but can pay closing costs within each program's limit: 4% concessions on VA, 6% on FHA, 3% on a conventional loan above 90% LTV.
- **Gifts and assistance can stand in for FHA's 3.5%.** FHA accepts gifts from family, employers, charities and government homebuyer programs.
## No-money-down options at a glance
| Option | Minimum down payment | Mortgage insurance or fee | Who qualifies |
| --- | --- | --- | --- |
| **VA loan** | **$0** with full entitlement, if the home appraises at or above the price | No monthly mortgage insurance; one-time funding fee of 2.15% first use ($0 down), waived with VA disability compensation | Eligible veterans, service members, some surviving spouses |
| **USDA guaranteed loan** | **$0**; the loan can cover up to the appraised value plus the guarantee fee | 1% upfront guarantee fee and 0.35% annual fee (FY2027) | Household income under USDA's moderate-income limit; home in an eligible area |
| **FHA loan** | **3.5%** with a 580+ credit score; 10% with a score of 500–579 | 1.75% upfront premium plus an annual premium (0.55% on a 30-year loan with under 5% down and a base loan of $726,200 or less) | Anyone who meets FHA credit, income-qualifying, occupancy and residency rules |
| **Conventional (Fannie Mae HomeReady)** | **3%** (97% LTV when underwritten through DU) | Private mortgage insurance until it cancels | Income and other HomeReady eligibility rules apply |
| **Down payment assistance** | Can cover some or all of a 3% or 3.5% minimum | Depends on the program (grant, forgivable or repayable second loan) | Set by each state or local program |
The VA rows come from [VA's funding fee and closing costs page](https://www.va.gov/housing-assistance/home-loans/funding-fee-and-closing-costs/) and its [entitlement and loan limits page](https://www.va.gov/housing-assistance/home-loans/loan-limits/). The USDA fee row comes from USDA Rural Development's [FY2027 fee notice](https://content.govdelivery.com/accounts/USDARD/bulletins/42b1054), which sets "an upfront guarantee fee of 1.00 percent and an annual fee of .35 percent." The FHA rows come from [HUD Handbook 4000.1](https://www.hud.gov/sites/default/files/Housing/documents/40001-hsgh-Update-18.pdf) and the premium table in [Mortgagee Letter 2023-05](https://www.hud.gov/sites/dfiles/OCHCO/documents/2023-05hsgml.pdf).
## The two true $0-down loans
### VA loans
VA's guaranty is what makes $0 down possible. VA's funding fee page says the program "doesn't require down payments or monthly mortgage insurance," and the fee exists to offset that cost to taxpayers. If you have full entitlement, VA says you don't have a loan limit, "as long as you can afford the loan amount and the property appraisal supports the purchase price of the home." The $832,750 figure you'll see quoted is the [2026 baseline conforming loan limit](https://www.fhfa.gov/news/news-release/fhfa-announces-conforming-loan-limit-values-for-2026). It isn't a VA cap on a full-entitlement buyer; county limits only come into a VA loan when part of your entitlement is still charged to a prior VA loan and hasn't been restored.
You'll need a down payment on a VA loan in two main cases. One is when part of your entitlement is still in use and the loan is bigger than your remaining entitlement covers (most lenders want entitlement plus cash to cover 25%). Even then, VA's own example shows a veteran with $50,000 of entitlement in use, buying in a county with a $900,000 limit, could borrow up to $700,000 before most lenders would ask for a down payment. The other is when the home appraises below the contract price. Our guide to the [VA loan down payment](/learn/va-loan-down-payment) walks through each one with numbers.
The cost of $0 down on a VA loan is the funding fee. On a first-use purchase with less than 5% down it's 2.15% of the loan amount; after first use with less than 5% down, it's 3.3%. You can pay it at closing or roll it into the loan. You won't pay it at all if you receive VA compensation for a service-connected disability. The [VA funding fee calculator](/calculator/funding-fee) gives you the exact figure for your price and service history.
### USDA guaranteed loans
USDA's guaranteed loan has no minimum down payment either. Under [7 CFR § 3555.103](https://www.law.cornell.edu/cfr/text/7/3555.103), the loan can't exceed the lesser of the appraised market value plus the upfront guarantee fee, or the purchase price plus eligible acquisition costs. That second part matters: under [7 CFR § 3555.101](https://www.law.cornell.edu/cfr/text/7/3555.101), those costs can include title insurance, recording fees, the appraisal and other reasonable closing costs. So a USDA loan can sometimes finance closing costs too, if the home appraises high enough to leave room.
The catch is eligibility. Adjusted household income at approval can't exceed USDA's moderate-income limit for the area, and the home has to be in an area USDA treats as eligible. And unlike VA, USDA charges a recurring fee: 0.35% a year for FY2027, on top of the 1% upfront fee. Our [VA vs USDA loan comparison](/learn/va-vs-usda-loan) runs the 30-year math for buyers who qualify for both.
## What $0 down saves on a $350,000 home
Here's the same $350,000 home under each program's minimum. Rates aren't shown because we don't quote them, and real rates differ by lender, program and borrower.
| | VA ($0 down, first use) | USDA ($0 down) | FHA (3.5% down) | HomeReady (3% down) |
| --- | --- | --- | --- | --- |
| Down payment | $0 | $0 | $12,250 | $10,500 |
| Upfront fee | $7,525 funding fee (2.15%), can be financed | About $3,535 guarantee fee (1%), can be financed | $5,911 upfront premium (1.75% of the $337,750 base loan) | None |
| Loan amount if the fee is financed | $357,525 | About $353,535 | $343,661 | $339,500 |
| Ongoing cost | No monthly mortgage insurance | 0.35% a year, about $100 a month at first | 0.55% a year, about $155 a month at first, for the life of the loan | PMI until it cancels |
The VA fee is 2.15% of $350,000. The FHA figures use the 3.5% minimum investment from Handbook 4000.1 and the 55-basis-point annual premium HUD sets for a 30-year loan above 95% LTV with a base loan of $726,200 or less (larger loans pay 75). The USDA and FHA monthly figures are year-one approximations; both fees are charged on the balance, so they shrink slowly as you pay the loan down.
If you receive VA disability compensation, the VA column loses its $7,525 fee. You'd borrow $350,000 with nothing down, no funding fee and no monthly mortgage insurance. None of the other options here gets you into the house for less.
## How to buy a house with no money down when you don't qualify for VA or USDA
### Use a gift or down payment assistance on FHA
FHA's 3.5% doesn't have to come from your savings. Handbook 4000.1 accepts gifts from a family member, your employer or labor union, a close friend with a documented interest in you, a charitable organization, or a government agency with a homeownership assistance program for low- or moderate-income families or first-time buyers. A government agency, a HOPE grantee or a family member can also lend you the 3.5% as a second loan, and Handbook 4000.1 lets that secondary financing count toward your minimum investment (a family loan can't push the combined LTV above 100%). A second loan from a HUD-approved nonprofit can't be used for that part. Gifts need a signed gift letter stating no repayment is required.
State and local housing agencies run most down payment assistance. Some give grants, some give second loans that are forgiven after a set number of years, and some must be repaid when you sell or refinance. Read the repayment terms before you count the money as free.
### Go conventional with 3% down
Fannie Mae's HomeReady allows up to 97% LTV for a one-unit principal residence underwritten through its DU system (95% if manually underwritten), per [Selling Guide B5-6-02](https://selling-guide.fanniemae.com/sel/b5-6-02/homeready-mortgage-underwriting-methods-and-requirements). That's 3% down. You'll pay private mortgage insurance, but unlike FHA's annual premium at minimum down, PMI on a conventional loan [can be cancelled](https://www.consumerfinance.gov/ask-cfpb/when-can-i-remove-private-mortgage-insurance-pmi-from-my-loan-en-202/) as you build equity. Our [VA vs conventional comparison](/learn/va-vs-conventional) shows when PMI drops and what that does to the payment.
## Cash you still need at closing
A $0 down payment covers the down payment and nothing else. Expect to bring money for some or all of these:
- **Closing costs.** VA lists the usual ones: the appraisal fee, title insurance, recording fees, state and local taxes, plus hazard insurance and real estate taxes. VA notes closing costs vary with the loan amount, the property's location and the lender. The [CFPB's closing costs explainer](https://www.consumerfinance.gov/ask-cfpb/what-are-closing-costs-en-1845/) says the buyer generally pays them unless the contract or state law puts some on the seller.
- **An earnest money deposit,** if your purchase contract calls for one.
- **Reserves**, if your lender or program wants savings left over after closing.
Our [VA loan closing costs guide](/learn/va-loan-closing-costs-2026) breaks down the VA version line by line.
### Getting the seller to pay closing costs
Seller money can cover closing costs, but never the down payment. [Fannie Mae's interested-party rules](https://selling-guide.fanniemae.com/sel/b3-4.1-02/interested-party-contributions-ipcs) don't let those contributions make the down payment, and Handbook 4000.1 says they "may not be used for the Borrower's MRI" on FHA. VA, FHA and Fannie Mae each cap what the seller can give:
| Program | Seller contribution limit |
| --- | --- |
| VA | Concessions up to 4% of the home's reasonable value; normal closing costs paid by the seller don't count toward the 4% |
| FHA | Up to 6% of the sales price toward closing costs, prepaid items and discount points |
| Conventional (Fannie Mae), principal residence | 3% above 90% LTV/CLTV, 6% from 75.01% to 90%, 9% at 75% or less, measured on the lower of price or appraised value |
For a $0-down buyer, VA's rule is the friendliest of the three. VA says it doesn't limit seller credits for a loan's closing costs, and caps only concessions (things like paying your funding fee or paying off a debt) at 4%. Our guide to [VA loan seller concessions](/learn/va-loan-seller-concessions) shows how to ask for them in an offer.
The CFPB points out that a seller credit usually comes with a higher purchase price, and a lender credit typically means a larger loan or a higher interest rate. Credits shrink your cash at closing; you pay for them over the life of the loan.
## Bottom line
You can buy a house with no money down through a VA loan or a USDA guaranteed loan. If you've served, start with VA: it has no monthly mortgage insurance, no VA loan limit with full entitlement, and no funding fee if you receive VA disability compensation. If you're not VA-eligible, USDA is the other mainstream $0-down loan, and FHA or HomeReady with a gift or assistance program can get your out-of-pocket costs close to zero. Either way, plan for closing costs. To see your VA numbers, take the [2-minute check](/start/loan-purpose).
## Frequently asked
### Can you buy a house with no money down?
Yes, with two federal loan programs. A VA loan needs no down payment for most eligible veterans and service members, and a USDA guaranteed loan can cover up to the full appraised value for buyers under USDA's income limit in an eligible rural area. FHA needs at least 3.5% down and Fannie Mae's HomeReady needs 3%, though gifts or approved assistance can supply that money for some buyers. Either way, $0 down isn't the same as $0 at closing.
### What is the cheapest no-down-payment loan?
If you qualify for both, usually the VA loan. It has no monthly mortgage insurance, while USDA charges an annual fee of 0.35% of the balance for the life of the loan. USDA's upfront fee is smaller (1% vs VA's 2.15% on a first-use, $0-down purchase), and VA waives its fee entirely if you receive VA disability compensation.
### Can the seller pay my down payment?
No. Seller money can't be your down payment on these loans. Fannie Mae doesn't allow interested-party contributions to make the down payment, and FHA doesn't allow them to cover the 3.5% minimum investment. Sellers can pay closing costs within each program's limit: up to 4% of reasonable value in concessions on VA (normal closing costs don't count toward it), 6% of the price on FHA, and 3% on a conventional loan with more than 90% LTV.
### Do I still need cash to close on a $0-down loan?
Usually some. Closing costs vary by loan amount, location and lender, and you generally pay them as the buyer unless the seller agrees to cover some. VA lets you finance the funding fee into the loan. USDA lets eligible closing costs go into the loan up to the appraised value plus the guarantee fee. Anything not financed or paid by a seller or lender credit comes from you.
### Is a lender credit free money for closing costs?
No. The CFPB notes that a lender credit typically means a larger loan or a higher interest rate, and a seller credit usually comes with a higher purchase price. Credits can cut the cash you bring to closing, but you pay for them over time.