No Down Payment | First-Time Home Buyer Guide 2025

Buying your first home is exciting—but saving up a big down payment? Not so much. If you’re a first-time home buyer wondering how to skip that 20% down payment rule, you’re not alone.

The good news: you don’t always need a large down payment—or any at all.

In this guide, we’ll break down how first-time buyers can purchase a home in 2025 with low or zero down, which loan programs to look for, and what to expect throughout the process.

Do I Really Need a 20% Down Payment?

Nope—and honestly, most first-time buyers don’t put down 20%

According to recent data from the National Association of Realtors, the average down payment for first-time buyers is closer to 6-7%. And thanks to government-backed and specialty loan programs, many buyers can qualify with as little as 3%, 1%, or even 0% down.

How to Buy a Home with No Down Payment

To buy a home with no money down, you’ll need to qualify for a zero-down mortgage loan. In 2025, there are two main types of loans that allow this:

Low Down Payment Options (As Little As 3%)

If you don’t qualify for a VA or USDA loan, don’t worry—there are still low down payment mortgage options available:

💸 Down Payment Assistance Programs (DPA)

Many states and cities offer down payment assistance (DPA) programs specifically for first-time home buyers. These programs can help reduce your out-of-pocket costs by offering:

• Grants (you don’t pay them back)
• Forgivable second loans
• Deferred-payment loans (repaid when you sell or refinance)

These programs vary by location, so check with your state housing agency or lender to explore what’s available near you.

What About Closing Costs?

Even with a no-down-payment mortgage, you’ll still need to cover closing costs—usually around 2-5% of the home’s purchase price. But there are ways to reduce or avoid these too:

• Ask the seller to pay a portion (called seller concessions)
• Use lender credits (in exchange for a slightly higher rate)
• Combine with a down payment assistance program that covers both

Can I Really Afford to Buy a House with No Money Down?

Yes—but affordability still matters.

Here’s what lenders typically look for:

• Steady income
• Reasonable debt-to-income (DTI) ratio
• Decent credit history
• Cash reserves (sometimes optional)

Just because you can buy with no down payment doesn’t mean you should stretch your budget. Make sure the monthly payment fits comfortably with your lifestyle and future goals.

FAQs

Can I buy a home with no down payment in 2025?

Yes! With VA and USDA loans, you can buy a home with 0% down—if you meet the eligibility requirements.

What credit score is needed for a no down payment loan?

It varies. VA loans typically require 620+, USDA usually needs 640+, and FHA allows 580+ with 3.5% down.

What are the benefits of buying a home with no down payment?

The biggest advantage is keeping your savings intact. It helps first-time buyers get into a home sooner without waiting years to save up 20%.