These loans may carry no or very low interest rates, and part of the debt may be forgiven for each year that you remain in the home. Also, you may use a portion of the loan to pay for closing or rehabilitation costs that are not included in the sale price of the home. These loans can sometimes be obtained through state housing finance agencies, HUD, and Federal Home Loan banks. They are called second mortgages because they are secured by a subordinate lien on your home. The gift may be in the form of cash or a trust, which will be discussed later.
Some employers offer programs which pay a portion of their employees down payment or closing costs.