Also, make sure to include all the income you have. If you have any equity in any stocks or other financial accounts, make sure to mention that to the broker as well.

The more money you can put down on the loan, the more likely it is that you can get approved. FHA loans usually only require 3-5% down. They are also usually open to working with people with credit problems.

Special relationships

Many realtors have special relationships with lenders. In this way, a realtor can act as a broker. In fact, you will find that a great many real estate agents have also been certified as mortgage or real estate brokers. This way they can act on your behalf to come to a financing relationship that will allow you to buy a home with no money down. If you go into a real estate office and discuss your financial situation, you will find that many offices have a specific relationship with a lender, allowing them to cut special financing deals. In these situations, everyone wins: you get the house, the realtor makes a sale, and the lender gets to charge you interest on the loan.

Creative financing

Some lenders simply help you with buying a home for no money down and insist that you roll mortgage insurance payments into the total loan amount. This way there is protection for the lender in case you default. Other lenders are more creative. They help you take out two loans: one for the amount of 20%, which is used as the down payment, and one for the remainder of the purchase price. This can be helpful to you, in that you do not have to pay the mortgage insurance, but it can also be a problem if you can't afford to make two payments. Plus, in many cases the 20% loan interest rate is either variable, or fixed for the first part of the term before it balloons during the second part of the term.

Higher interest

You should understand that anytime you decide to buy a home with no money down you will pay a higher interest rate. There is no way to avoid this. Buying a home with no money down presents a significant risk to the lender. This is compounded if you have questionable credit. The more money you can put toward a down payment, the lower your interest rate will be.

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The average rate of interest on mortgage loans continues to fall and has been under 5 percent for almost all of this past year, with this recent round of rate cuts seen as the lowest for borrowers in years. The reason, many borrowers today have bad or at least less than perfect credit scores. Still a borrower with less then perfect credit an jump through a few hoops and get a fairly decen rate on a loan.