 TITLE: Types of No or Low Down Payment Mortgages CONTENT: Loans That Allow Low Down Payments\n----------------------------------\nIf you're not eligible for loans that don't require down payments, there are plenty of options with low down payments:\n### FHA Loans\nDown payments for these government-backed loans are as low as 3.5%. FHA loans are insured by the Federal Housing Administration and typically have lower closing costs—and credit score requirements—than conventional loans. There's a 580 minimum FICO® Score☉ for the lowest down payment option, though credit scores can be as low as 500 as long as you put at least 10% down. It must be for a primary residence, and there are some additional restrictions on property type and value.\nThese loans still carry closing costs, though they can be rolled into the loan amount. Additionally, FHA loans require mortgage insurance to reduce risk to the lender. Your upfront mortgage insurance premium is usually 1.75% of the loan amount. You'll also have an ongoing annual mortgage insurance premium (paid monthly) that usually costs between 0.45% and 1.05% of the loan amount. With conventional loans, mortgage insurance typically disappears once you hit 20% equity; with FHA loans, however, it remains for the life of the loan unless you put down at least 10%; then it goes away after 11 years.\n### Freddie Mac Mortgages\nGovernment-sponsored agency Freddie Mac offers a few products via mortgage lenders. The Freddie Mac Home Possible mortgage allows down payments starting at 3% and is geared toward low income homeowners. Even borrowers without credit scores are eligible to borrow with as little as 5% down. Mortgage insurance is required on single-family homes until 80% equity is reached, though coverage requirements can be reduced at 90%. This type of loan allows down payment and closing costs to come from a variety of sources, and it permits co-borrowers to contribute even if they won't reside at the home.\nFreddie Mac also offers HomeOne for first-time homebuyers buying single-family homes with down payments as low as 3%. Mortgage insurance required, and at least one borrower must have a credit score.\n### Conventional Loans\nSome lenders also offer conventional loans with low down payments. One example is Wells Fargo's Dream. Plan. Home. mortgage that permits down payments as low as 3%, and has flexible credit and income standards (though mortgage insurance is required). Other lenders allow for lower down payments on conventional loans, but those options may be reserved for borrowers with strong credit scores. END