loanDepot Offers Zero Down To FHA Borrowers

FHA borrowers with loanDepot can now put zero down upfront with its new “accessZERO” program.

The program offers up to 5% of a home’s purchase price in down payment assistance structured as a 10-year fully amortized repayable second mortgage. It is geared towards buyers who are struggling with saving for a down payment as home prices soar. 

Down payments by percentage have fallen in 2023 after inflating during the pandemic buying boom when buyers used them to outbid their competition. This is partly because FHA and VA loans, which allow borrowers to pay less upfront, have gained traction as homebuying gets more expensive.

As inflation runs rampant and home prices remain high, many Americans have struggled to save for a down payment. Millennials buying their first homes are having to work second jobs, cut back on spending, and move in with family to set funds aside.

“Nearly half of Americans who have never owned a home say that saving money for a down payment is a barrier to homeownership, and many young people in particular feel like they’ll never be able to own a home,” Christian Taubman, Redfin’s Chief Growth Officer, said of the trend.

loanDepot’s offer is available to both first-time and repeat homebuyers who meet loanDepot’s minimum credit score and debt-to-income ratio requirements. Borrowers can access this offer everywhere except New York, and it is only available alongside standard 203(b) FHA purchase transactions.

“As we continue to unlock new ways for our customers to purchase homes in today’s challenging market, accessZERO helps address a significant barrier, particularly for first-time buyers grappling with the obstacle of saving for the higher-down payments that come with the rising costs of housing,” said LDI Mortgage President Jeff Walsh.

The median down payment on a single-family home was $31,500 in Q2 2023.

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