Here’s a straightforward overview of home loans with no money down and hard money loans, explaining what they are, pros and cons, and typical situations where they apply.
Home Loans With No Money Down
What Are They?
Home loans that require no upfront down payment—meaning you don’t have to put your own money down when buying a home.
Common Types
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VA Loans (for U.S. military veterans and active-duty members):
These government-backed loans often require no down payment and offer favorable terms. -
USDA Loans (for rural and some suburban areas):
Also government-backed, designed for low- to moderate-income buyers in eligible areas with no down payment. -
Some Conventional Loans with 0% Down:
Rare and usually require excellent credit and other conditions, sometimes offered by lenders as special promotions.
Pros
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No upfront cash needed, so easier entry into homeownership.
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Government-backed loans often have competitive interest rates.
Cons
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Typically require mortgage insurance or other fees to protect the lender.
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Stricter eligibility requirements (income limits, location, credit score).
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Can mean paying more over the life of the loan.
Who Benefits?
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First-time buyers with little savings.
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Veterans and rural buyers meeting eligibility.
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People who want to keep cash reserves.
Hard Money Loans
What Are They?
Short-term, high-interest loans secured by real estate, provided by private lenders instead of banks.
Characteristics
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Used mostly for investment properties, house flipping, or situations where traditional loans aren’t available.
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Approval based mostly on the property value (collateral), not borrower creditworthiness.
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Higher interest rates (often 8–15% or more).
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Short repayment terms (6 months to a few years).
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Fast approval and funding.
Pros
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Quick access to funds.
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More flexible qualification criteria.
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Useful for borrowers with poor credit or unconventional situations.
Cons
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Much higher interest rates and fees.
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Short repayment periods mean higher monthly payments.
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Risk of losing the property if you default.
Who Uses Them?
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Real estate investors needing quick cash.
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Buyers with credit issues who can’t get traditional loans.
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Borrowers needing short-term bridge loans.
Summary Table
| Loan Type | Down Payment | Interest Rates | Term | Best For |
|---|---|---|---|---|
| No Money Down Loans | $0 (with conditions) | Low to moderate | 15–30 years | Veterans, rural buyers, first-time buyers with good credit |
| Hard Money Loans | Usually no down payment, but collateral required | High (8%+) | Short term (6 months–3 years) | Investors, borrowers with credit problems, short-term financing needs |
Owner Occupant Investment Property Loans
If you live in the Phoenix Valley and would like to get started with growing your real estate portfolio Brad Loans can help! Our lending service makes it easy for investors to finance new properties as owner occupants. We can work with bad credit, lend faster, and understand the real estate investment industry with decades of local knowledge in investing, fix and flip, and much more. Read about our loan programs by clicking here.
Call Today To Start Your Owner Occupant Loan 602-999-9499
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