Q.
Is buying a home with nothing down a good idea?
A.
Buying a house is a great investment and will result in a nice tax write-off at the end of each year. But a lower down payment means a higher monthly mortgage (mostly paid toward the bank interest owed), so research before doing this yourself. Some loans will also allow you to roll your down payment and closing costs into the mortgage, but this too will give you a higher monthly payment (without adding value to your house!). The smartest choice is to look into an FHA (Federal Housing Administration) loan, which is a program for first-time homeowners. You only need 3 percent down, and the loans have competitive interest rates and are often easier to qualify for. The best part is that the federal government insures the loan, so you don’t have to deal with mortgage brokers who make a profit from you and don’t always have your best interests at heart.
-- The Nest Editors
See More: Buying a Home , Mortgages