Best Low and No Down Payment Mortgages of 2020

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Points of Interest

Low or no down payment mortgages can help buyers with little savings afford homes, but there are some downsides to these types of loans — including the fact that you’ll pay more in interest over the life of the loan.

If you don’t have enough money saved to make a 20% down payment on a house, buying a home may feel out of reach. Don’t lose hope, though. While 20% may be out of the realm of possibilities, buying a home isn’t. After all, there are many low or no down payment lenders who will give you a mortgage with little money down. Some lenders will even help you with closing costs if you can’t afford them on your own. 

If you want to achieve your dream of homeownership but don’t have a lot of cash in the bank, check out some of the best no down payment mortgages. These lenders may be able to get you into a home you own quicker than you think.

The 7 best low or no down payment mortgage lenders of 2020

  • PNC Bank — Best for no mortgage insurance
  • Navy Federal — Best for military families
  • Quicken Loans — Best for custom loan terms
  • loanDepot — Best for in-person lending
  • SoFi — Best for no origination fee
  • PrimeLending — Best for closing cost assistance
  • Rocket Mortgage — Best for online lending
 Minimum depositMinimum credit scoreCurrent min and max mortgage loan APRs
PNC Bank3%6202.908% for 10-year loan to 3.370% for 30-year loan
Navy Federal0%6202.535% for 15-year loan to 2.926% for 30-year loan
Quicken Loans3%6203.174% for 10-year loan to 3.5% for 30-year loan
Loan Depot3.5%6202.819% for 15-year loan to 3.083% for 30-year loan
SoFi10%6602.663% for 10-year loan to 3.613% for 30-year loan
PrimeLending3%, up to 100% financing6202.625% for 15-year loan to 3.375% for 30-year
Rocket Mortgage3%6203.139% for 30-year fixed loan

What is a low or no down payment mortgage lender? 

Some mortgage lenders require a 20% down payment on their conventional loans. But a low or no down payment lender will allow you to put between 0% and 3.5% down on a mortgage. This makes it easier to afford a home if you have minimal savings or a low income. Some low down payment lenders will even offer you assistance with closing costs if you can’t pay for them on your own.

Pros of low or no down payment mortgage loans

If you’re a first-time homebuyer with minimal savings, a no down payment mortgage can help you get into a home and start building equity sooner. And since you won’t have to sink your whole life savings into a down payment, you’ll have more money left over for home renovations and improvements.

Cons of no down payment mortgage loans

Putting less money down means your monthly mortgage payments will be higher, so they may be harder to afford. Your lender may also require private mortgage insurance or charge you a higher interest rate, which will raise your monthly payment even more. You’ll also start out with less equity in your home, which could end up leaving you with negative equity if home prices drop.

How to choose the best low or no down payment mortgage lender

One thing to consider when choosing a lender is whether you want to apply for your mortgage in person or online. If speaking to a loan officer face to face is important to you, make sure you choose a lender with physical branches in your area.

Another thing to think about is how large of a down payment you want to make. Some lenders require a down payment of 3% or 3.5%, while others won’t make you put any money down.

Tip: A zero money down loan will save you money now, but will cost you more interest in the long run. If you can afford to, it may be better to make a small down payment.

Before you commit to a lender, you should also shop around and compare rates and fees. To save money, find one that offers competitive interest rates and doesn’t require private mortgage insurance.

The 7 best low or no down payment mortgage lenders of 2020

PNC Bank — Best for no mortgage insurance

PNC Bank offers conventional loans with terms ranging from 10 to 30 years and down payments as low as 3%. No matter how much money you put down, you won’t have to pay private mortgage insurance, which is a big plus. If you need closing cost assistance, the lender also provides $1,500 grants to qualifying borrowers with low-to-moderate incomes.

Navy Federal — Best for military families

Navy Federal provides low and no down payment mortgages to military families. Its conventional loans only require you to put 5% down and don’t require private mortgage insurance. Plus, it offers VA loans, adjustable-rate mortgages and loans for first-time homebuyers that don’t require down payments. Navy Federal also has a program that allows you to earn cash back on your home purchase. If you use a real estate agent from the lender’s network, you could get between $400 and $8,000 in cash back at closing.

Quicken Loans — Best for customer service

Quicken Loans is America’s largest mortgage lender and has been ranked highest in customer satisfaction by JD Power for 10 years running. The lender offers mortgages with 3% down payments, customizable term lengths and rates as low as 3.174%. It also has a program called PMI Advantage that allows you to eliminate your mortgage insurance by paying a slightly higher interest rate.

loanDepot — Best for in-person lending

loanDepot has over 150 locations nationwide, making it a great option for borrowers who want to apply for a mortgage in person. Its conventional loans have annual percentage rates as low as 2.819% and require a down payment of 5%. If you can’t afford to put 5% down, you can also get an FHA loan with a down payment of 3.5%.

SoFi — Best for no origination fee

If you have enough money saved to make a slightly larger down payment, SoFi may be a good option for you. The lender requires borrowers to put at least 10% down on all of its loans. In return, it offers perks like no origination fees, no prepayment penalties and no private mortgage insurance on jumbo loans, which makes the higher down payment cost worth it.

PrimeLending — Best for closing cost assistance

PrimeLending is a mortgage lender headquartered in Texas that has been providing home loans to customers across the country since 1986. Its conventional mortgages require a down payment of just 3%, and in some cases, 100% financing may be available. The lender also offers up to $2,000 in closing cost assistance to qualifying borrowers who live in low-to-moderate income areas.

Rocket Mortgage — Best for online lending

Rocket Mortgage has a streamlined online mortgage process and even lets you apply for a home loan on your smartphone. The lender’s mobile app allows you to upload and sign documents, chat with loan officers and track the progress of your mortgage. Its conventional loans have a low down payment requirement of just 3% and offer competitive rates as low as 3.139%.

The final word

Low or no down payment home loans can make it easier to afford a home if you have minimal savings or a moderate income. However, they cost more in the long run than mortgages with higher down payments due to the increased interest you’re paying on the principal. Before you take one out, consider whether or not it’s the best option for you.