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Definition: Low-Down Mortgages
The mortgage agreement that requires low amount of down payment. The low-down mortgages generally allow down payment of 3-5% of total property value. Some lenders have program for 0 down payment as well in which all the property value is collected through financing.
Low-down mortgages are designed for borrowers who can not bring up significant initial down payment required for the deal because of their modest income sources. These programs help first time home owners. Low-down mortgages have helped a lot of lower income and first-time buyers to have their own home. Some borrowers use the money for down payments for other purposes and as a result add risk to the home ownership. Using low-down mortgages for purposes other than buying home should be carefully analysed on the basis of risk and costs.