Should You Finance 100% of Your Home's Value?

Should You Finance 100% of Your Home's Value?

It’s a question I get more often than you’d think: “Can I really buy a home without putting any money down?”

The answer? Yes, sometimes. But should you? That’s where it gets more complex.

Let’s break down what it actually means to finance 100% of your home’s value, and how to know if it’s the right fit for you.

What Does Financing 100% Mean?

Financing 100% means you’re using a mortgage (or a combo of loans) to cover the entire cost of the home. You’re not making a down payment, and in some cases, lenders will even let you roll in certain closing costs.

There are a few types of loans that make this possible:

• VA Loans: For eligible military service members and veterans. No down payment required.

• USDA Loans: Available in designated rural areas. 100% financing is often part of the package.

• Conventional First-Time Buyer Programs: Some offer 3% down, but may allow gifted funds or down payment assistance to cover that.

In Utah, some local down payment assistance programs can also be paired with traditional mortgages to reach that 100% threshold.

The Benefits of 100% Financing

1. Lower Cash Barrier to Entry: You don’t need $20K+ saved up to get in the game.

2. Get in Sooner: Instead of waiting years to save a big down payment, you start building equity now.

3. More Money for Reserves or Repairs: If all your cash isn’t tied up in the down payment, you can hold some back for future expenses.

The Risks of 100% Financing

1. Higher Monthly Payments: With no equity up front, your loan amount is larger, which means bigger payments.

2. Potential for Negative Equity: If the market dips and you haven’t paid much down, you could owe more than the home is worth (this happened in 2008).

3. Limited Loan Types & Restrictions: These programs often come with rules around income limits, property location, and occupancy.

4. No Skin in the Game: While not always the case, buyers with 0% down may have less flexibility in negotiations or may face stricter lender scrutiny.

How to Know if 100% Financing Is Right for You

Ask yourself:

• Are you buying in a stable or growing market (like Salt Lake County)?

• Is your income steady with some room for emergencies?

• Are you planning to stay in the home for 5+ years?

• Do you understand your loan structure and have a plan for building equity?

If you’re just trying to “buy because you can,” this may not be the right move. But if you’re making a smart, stable step forward—and understand what you’re committing to—100% financing can be a legit path to ownership.

Nick’s Take

In today’s higher-rate environment, getting into the market sooner can still beat waiting. We’re seeing Utah’s real estate values continue a long-term upward trend, and many buyers are using low or no down payment programs to start building wealth now—then refinance when rates improve.

I always tell clients: It’s not just about buying a home. It’s about building a future that’s financially smart and aligned with your goals. If that means starting with 0% down but a solid safety net and a good plan? I’m in your corner.

Final Thought You don’t need to wait until you have everything “perfect” to buy a home—but you do need to go in with your eyes wide open. 100% financing isn’t for everyone, but with the right advice and a smart strategy, it could be a powerful step toward ownership.

Want to know if you're eligible for 100% financing in Utah? Let's connect and run the numbers together.