Zero Down

Zero Down

A zero down loan is good when you don't have enough cash to pay your closing costs and make a down payment on the purchase of your home. It is also used to avoid paying Private Mortgage Insurance (PMI) costs.

Zero down programs allow you to buy your home now, instead of waiting to save enough for a down payment.

There are several options available for buying a home with zero down.

Get one new loan at 100 percent loan-to-value (LTV). PMI is usually required, and the insurance charges are not tax deductible.
Get an 80 percent first loan and a 20 second (piggy-back or 80/20) loan. This program does not require PMI, and all interest is tax deductible.
Get a new first loan and have the seller carry back a second loan for the balance of the purchase price.

Some zero down programs allow you to borrow 3 to 7 percent of the purchase price to pay your closing costs. Ask your loan officer if you qualify for any of these programs.

PMI is an additional charge you pay if you make less than a 20 percent down payment. This insurance policy protects the lender in the event of a payment default or foreclosure, and the loan is not paid off in full. The PMI payment ranges from 0.19 percent for a fixed rate loan with a 15 percent down payment; up to 1.09 percent with zero down; and as high as 1.34 percent on a zero down variable rate.

First Community Bank - 28 North Last Chance Gulch, First Floor - Helena, MT 59601
Office Phone: (406) 449-9800 Fax: (406) 449-9811 Toll Free Phone: (866) 908-9808

Lending in Montana for over 119 Years

In Business Since 1891 !

Check Out Our Banking Website at www.fcbank.net

Throughout this website information and interactive calculators are made available to you as self-help tools for your independent use. We cannot and do not guarantee their accuracy or their applicability to your circumstances. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.

Please complete the"Information for Government Monitoring Purposes" section on the Application only if you are applying for the Purchase or Refinance of your Primary Residence.