Buy Your First Home With No Down Payment in 2026

A no down payment mortgage can be a game changer, but “zero down” does not mean “zero cost.” In today’s market, the smartest approach is understanding (1) which zero down programs you may qualify for and (2) how to reduce the cash you still need for closing day.

This guide walks you through the most common true 0% down options, plus practical ways first-time buyers cover closing costs and move in without draining their savings.

Key takeaways

• Zero down mortgage programs exist, most commonly through VA and USDA options. Veterans Affairs+1
• “Zero down” still comes with costs like appraisal, inspections, prepaids, and closing costs, but you may be able to offset some of these with credits and assistance. Veterans Affairs
• USDA loans have an upfront and annual fee structure that functions similarly to mortgage insurance. Rocket Mortgage+1
• VA loans do not require monthly mortgage insurance, but most borrowers pay a one-time VA funding fee (with exemptions for some). Veterans Affairs+1

First, a quick reality check: what does “no down payment” actually mean?

A down payment is the portion of the purchase price you pay upfront. With a 0% down loan, you are financing 100% of the purchase (as long as the price supports the value requirements for the program). Veterans Affairs

But you still need to plan for cash-to-close, which may include:

• Home inspection and appraisal
• Closing costs (title, escrow, lender fees)
• Prepaids (homeowners insurance, property taxes, daily interest)

The win is that you get to buy without saving a huge down payment. The strategy is making sure you can handle the remaining upfront items without stress.

Option 1: VA loans (0% down for eligible buyers)

If you are eligible, VA financing is one of the strongest no down payment paths available.

Big benefits:

• No down payment required in many cases, as long as the sales price is not higher than the home’s appraised value. Veterans Affairs
• No monthly mortgage insurance (PMI or MIP). Veterans Affairs

What about the VA funding fee?

Most borrowers pay a one-time funding fee, but it can often be financed into the loan. Veterans Affairs
VA publishes a funding fee chart (effective April 7, 2023). For purchase loans, the fee is 2.15% for first use with less than 5% down and 3.3% for subsequent use with less than 5% down (with lower fees at higher down payment levels). Veterans Affairs

Some borrowers are exempt from the funding fee, including certain Veterans receiving VA disability compensation and other qualifying situations listed by VA. Veterans Affairs

Can a seller help with closing costs on a VA loan?

Yes. VA allows seller or builder credits to cover some or all buyer closing costs, and it limits seller concessions to no more than 4% of the home’s reasonable value (per VA guidance). Veterans Affairs

Option 2: USDA loans (0% down in eligible areas for qualified buyers)

USDA loans can also be a true 0% down option, but they are built for specific buyers and locations.

The basics:

• USDA loans are designed for eligible rural and some suburban areas.
• Eligibility is based on location and income requirements.
• The home must be your primary residence.

How do you know if a property qualifies?

USDA provides an official property eligibility map, but the website notes that viewing the map does not create a final determination. Final determination is made by Rural Development once a complete application is received. USDA Eligibility

USDA training materials also explain rural area definitions and note that eligibility designations can change over time based on reviews and census data. Rural Development

USDA fees (the part most buyers miss)

USDA loans typically include two fees:

• Upfront guarantee fee: As of 2025, Rocket Mortgage notes it is 1% of the loan amount and may change by fiscal year. Rocket Mortgage+1
• Annual fee: As of 2025, Rocket Mortgage notes 0.35% of the remaining loan balance, usually paid monthly. Rocket Mortgage

USDA training guidance also emphasizes that fee structures can change by fiscal year and that the annual fee applies for the life of the loan unless refinanced into a different program. Rural Development

Option 3: “No down payment” by using down payment assistance (DPA)

Even if you do not qualify for VA or USDA, you might still get close to a “no down” outcome by pairing a low down payment loan with assistance.

Many first-time buyer assistance programs can help with:

• Down payment funds (grant, forgivable second, deferred second)
• Closing costs and prepaids
• Homebuyer education support (required in some programs)

These programs vary by city, county, and state, and they can change funding availability quickly. This is where working with a local lender helps, because we can check what is currently open and what pairs with your loan type.

What to watch out for with zero down loans in 2026

A few practical considerations we review with buyers up front:

• Savings cushion matters. Zero down is great, but you still want reserves for move-in costs and first-year surprises.
• Appraisal matters more. With little or no down payment, appraisal gaps can be harder to cover. VA specifically notes no down payment as long as the sales price is not higher than the appraised value. Veterans Affairs
• The monthly payment might be the real hurdle. Even with 0% down, your payment still has to fit your budget and debt profile.

A simple “no down payment” game plan

1. Get pre-approved and identify which 0% down paths you qualify for (VA, USDA, or DPA + low down payment).
2. Estimate cash-to-close early so there are no surprises.
3. Choose an offer strategy that supports your budget, including potential credits where appropriate. Veterans Affairs
4. Keep finances steady until closing (avoid new debt and large undocumented deposits).

Ready to see if you qualify for 0% down?

Lifetime Home Loans can run a quick scenario review to show:

• Whether VA or USDA is on the table
• Your estimated cash-to-close
• Payment comparisons across options
• How credits or assistance could reduce upfront cost