No-Money-Down Mortgage Can Still Be Found in Small Towns

Banners declaring "no money down" might not sit well with homeowners burned by sub-prime loans, but believe it or not, there are legitimate mortgages available for little to no down payment. Now that the exotic loans that led to the housing crash have been curbed, at least for the time being, lenders are dusting off an old favorite to shore up homebuyer interest -- the USDA Rural Housing Loan.

The little-known program offers qualifying homebuyers the housing equivalent of a golden ticket – a 30-year fixed-rate loan with no down payment required and an option to finance all closing costs. Better still, applicants need not have sterling credit to qualify.

Besides the VA loan, which is only available to military veterans, the Rural Home Loan program is the only other government-guaranteed loan in which a buyer can close on a home for virtually nothing down.

So why haven't you heard of it?