No-cost home financing seems like an idea that's too good to be true. But it's here, and it's waiting for homeowners at Family Mortgage. No closing cost loans can be used for either a refinance or a purchase transaction, although they are most commonly associated with a refinance.

Keep in mind the concept of discount points. By paying points, you can buy the rate down.  Well, the reverse is true.  If you decide on a loan with a rate higher than the base rate, we as the lender are paid the opposite of discount points - called Yield Spread Premium.  We can use these funds to pay some or all of your closing costs. 

No one works for free, the slightly higher rate gives us the funds to pay all of the non – recurring closing costs. The no closing cost method does not increase your loan balance by one penny and can save you hundreds of dollars per month.

Should interest rates continue to decline, you can simply refinance again to obtain additional savings.