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How to Get a No-Down-Payment Mortgage – Zero-Down Home Loans

A 20% down fee isn’t the one option to get a mortgage. No-down-payment residence loans can open doorways to homeownership for patrons with restricted financial savings and release money for bills akin to closing costs or residence repairs. Right here’s what you possibly can anticipate while you’re shopping for a house with no cash down.

What Are the Finest No-Down-Fee Mortgage Lenders of 2021?

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Chase

3% Min. Down Fee
Not disclosed Min. Credit score Rating

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Lender

Study Extra
3% Min. Down Fee
Not disclosed Min. Credit score Rating

Best for digital customer care

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PrimeLending is a Dallas-based mortgage lender with a number of mortgage mortgage choices, together with typical loans, jumbo loans, government-backed loans and refinance loans. The lender is a subsidiary of PlainsCapital Financial institution.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened Fee, ARM, Refinancing, FHA, VA, Jumbo, USDA
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 0.03
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Homebuyers can select from a wide range of mortgage merchandise.

  • House loans can be found nationwide.

  • Down fee and shutting price help is on the market.

See full profile

Best for online mortgages with cash back rewards

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Axos Financial institution, based in 2000, is a digital monetary providers firm primarily based in San Diego. The complete-service on-line financial institution is insured by the Federal Deposit Insurance coverage Corp. and affords every part from persona; and enterprise financial savings and checking accounts to auto and residential loans.

Earlier than You Apply

  • Mortgage varieties: Typical, FHA, VA, Fastened-Fee, ARM, Jumbo, House Fairness Loans, HELOC, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 5%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Earn 3% annualized money again — 0.25% month-to-month — when you’ve got an Axos Financial institution checking account and use it pay your mortgage.

  • Cut back or eradicate the $995 lender charge with an Axos Financial institution checking account.

  • On-time closing is assured for patrons of single-family properties.

  • Entry mortgage lona consultants to debate your house financing wants.

See full profile

Best for low costs

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Chase, one of many nation’s largest banks, affords mortgages, refinance loans and residential fairness loans for certified debtors.

Earlier than You Apply

  • Mortgage varieties provided: Typical, FHA, VA, Fastened Fee, ARM, Jumbo, Refinancing
  • Minimal FICO credit score rating: Not disclosed
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Down funds as little as 3% are accepted.

  • Fastened- and adjustable-rate mortgages can be found.

See full profile

Best for product availability

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ConsumerDirect Mortgage is a division of FirstBank, a publicly traded financial institution primarily based in Nashville, Tennessee. ConsumerDirect Mortgage affords residence buy and refinance loans to eligible debtors.

Earlier than You Apply

  • Mortgage varieties: Typical, FHA, Fastened Fee, ARM, Jumbo, Refinancing, VA
  • Minimal FICO credit score rating: Not Disclosed
  • Minimal Down Fee: Not Disclosed
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Fastened and adjustable-rate mortgages can be found. A lender credit score for third-party closing prices is on the market for a lot of loans. <br/>Loans are provided in 49 states; ConsumerDirect Mortgage doesn’t lend in Maryland.

See full profile

Best for low down payment

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PNC Financial institution is among the largest U.S. banks, serving greater than 9 million clients in all 50 states. PNC affords most varieties of mortgages.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened Fee, FHA< VA, ARM, Jumbo, HELOC, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • A number of varieties of mortgages can be found.

  • PNC provides a web based residence possession price software.

  • Some mortgage choices require no or low down funds.

See full profile

Best for low APR

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New American Funding is a nationwide mortgage lender providing a wide range of residence mortgage choices to homebuyers and owners. The corporate was based in 2003 and is headquartered in Tustin, California. The lender has originated greater than $50 billion in mortgage loans so far.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened Fee, VA, FHA, ARM, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • The corporate has a number of mortgage choices, together with low-down-payment loans and loans the place you set your time period size.

  • You may select between fixed- or adjustable-rate loans.

See full profile

Best for bad credit

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Carrington Mortgage Companies makes a spread of mortgages, together with refinancing, accessible to debtors nationwide. The corporate, which offers typical and government-backed mortgages, has funded $22 billion in residence loans since 2011.

Earlier than You Apply

  • Mortgage varieties: Typical, FHA, VA, USDA, Fastened Fee, ARM, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Candidates with credit score scores as little as 500 are accepted for some merchandise.

  • The House Potential Benefit mortgage program can require a down fee of as little as 3%.

See full profile

Best for mortgage variety

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AmeriSave Mortgage Corp. is a web based lender that has been in enterprise since 2002. It was one of many first to supply an offsite, digital mortgage expertise for purchasers. The corporate says it has financed greater than 390,000 properties because it started working. With headquarters in Atlanta, AmeriSave providers loans in 49 states and Washington, D.C.

Earlier than You Apply

  • Mortgage varieties: Typical, Jumbo, Fastened Fee, ARM, FHA, VA, USDA, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • FHA, VA and USDA loans can be found, along with typical fixed-rate and adjustable-rate mortgages.

  • Potential debtors can get prequalified with out a onerous credit score inquiry.

  • Debtors can full nearly all of the appliance course of on-line.

See full profile

Best for product availability

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Freedom Mortgage is among the nation’s largest mortgage originators and servicers working in each state, plus Washington, D.C., Puerto Rico, and the U.S. Virgin Islands. Mortgage choices embrace typical, adjustable charge, jumbo, refinance, Federal Housing Administration, Division of Veterans Affairs and Division of Agriculture.

Earlier than You Apply:
Mortgage varieties provided: ARM, Typical, FHA, Fastened Fee, Jumbo, Refinancing, USDA, VA
• Minimal FICO rating: 620
• Minimal Down Fee: 3%
Higher Enterprise Bureau ranking: A+

Finest Options

  • Presents vast collection of mortgages.

  • Helps qualify debtors with honest credit score.

  • Focuses on FHA and VA loans.

See full profile

Best for customer service

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Rocket Mortgage, the most important mortgage lender within the nation, was based in 1985 as Rock Monetary. With headquarters in Detroit, the corporate affords a totally digital residence lending course of. On July 31, 2021, the lender modified its identify to Rocket Mortgage. It was beforehand often known as Quicken Loans.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened Fee, FHA, ARM, VA, Refinancing, Jumbo,
  • Minimal FICO credit score rating: 620,
  • Minimal Down Fee: 3%,
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Rocket Mortgage providers 99% of the loans it originates.

  • The corporate affords customizable mortgage phrases.

  • The digital utility course of is user-friendly, and mortgage standing data is at all times accessible.

  • Rocket Mortgage has a superb customer support popularity.

See full profile

What Are At present’s Mortgage Charges?

Locking in a low mortgage charge now can prevent hundreds of {dollars} over the lifetime of your mortgage. Examine your mortgage charge affords with nationwide common traits for present mortgage charges.*

Can You Get a Mortgage With No Down Fee?

You will get a no-down-payment mortgage, though you’re extra more likely to discover a low-down-payment mortgage. Many mortgages require a down fee, even a minimal 3%. However placing down 20% is now not the usual, even for some typical loans.

Whereas it’s true that the perfect phrases are usually reserved for well-qualified candidates who could make a 20% down fee, you possibly can make the most of numerous mortgage applications that demand far much less.

However in order for you a no-down-payment residence mortgage, understand that the loan types accessible to you could be restricted. Usually, no-down-payment mortgages come within the type of authorities loans or particular lender applications.

Sadly, homebuyers with low credit score scores won’t qualify for some applications.

What Credit score Rating Do You Have to Purchase a Home With a Low or No Down Fee?

There is no such thing as a single minimal credit score rating it’s essential to get a no- or low-down-payment mortgage; it varies by program. For instance, VA residence loans do not have a minimal credit score rating requirement, and neither do USDA residence loans. With FHA residence loans, you may get a mortgage with a credit score rating as little as 500, however you possibly can cut back your down fee in case your rating is increased than 580.

The essential factor to recollect is with the next credit score rating you’ll qualify for decrease rates of interest in your mortgage.

What Are the Zero-Down Mortgage Choices?

Zero-down-payment mortgage choices are the important thing to homeownership for a lot of debtors who lack the financial savings to place towards a house however qualify for a mortgage. Typically, typical loans don’t present zero-down-payment choices.

Listed here are a couple of zero-down residence mortgage applications to discover with 100% financing in your main residence.

Division of Veterans Affairs House Loans

The VA affords a zero-down-payment mortgage with no mortgage restrict however a restrict on what the VA will assure for qualifying veterans and spouses. Veterans who wish to apply should furnish a Certificates of Eligibility.

The VA mortgage program has no minimal credit score rating, however most VA-approved lenders have credit score rating necessities.

Some debtors could have to pay an upfront funding charge, which may be financed. VA residence loans don’t require mortgage insurance coverage.

U.S. Division of Agriculture Loans

“Folks assume USDA is all about farms, however it’s about areas which are outdoors of suburbia,” says Invoice Banfield, government vp of capital markets, Quicken Loans.

The Single Household Housing program has no credit score rating necessities, however candidates should present a capability to handle debt and pay payments.

Not solely is not any down fee wanted, but additionally the mortgage insurance coverage is barely 0.35%, in contrast with 0.85% for an FHA mortgage.

Physician Mortgage Program

Many lenders take part within the Doctor Loan Program, and a few provide zero-down choices. This system is designed for early profession physicians, dentists, residents and fellows, who incessantly have little or no cash saved and large scholar mortgage payments.

Credit score Unions

Many credit score unions have zero-down mortgages, though they typically require membership to qualify. Promotions can change, so examine along with your lender for the newest data.

When Is a Zero-Down-Fee Mortgage a Good Concept?

A zero-down mortgage is a good possibility for a homebuyer who has restricted money readily available however is in any other case well-qualified to buy a house.

Some good causes for selecting a no-money-down mortgage are to:

  • Reserve financial savings for different bills, akin to closing prices or residence enhancements.
  • Leverage money for investing fairly than tying up cash in a mortgage.
  • Get into a house sooner by not having to save lots of 20% of the mortgage worth.
  • Benefit from the market’s traditionally low rates of interest fairly than ready to save lots of and probably lacking out on a house.

Stepping into a house with out making a big down fee would possibly sound engaging, however placing cash down on a mortgage has its advantages. Even a small down fee can get monetary savings as a result of your month-to-month fee will price much less, you could lock in a decrease rate of interest, and you may keep away from paying non-public mortgage insurance coverage.

Some good causes for making a down fee in your mortgage:

  • It can save you on rates of interest as a result of your lender perceives much less danger.
  • You may keep away from paying a non-public mortgage insurance coverage premium.
  • You may cut back your month-to-month funds.
  • You may instantly have some fairness within the residence: The extra you pay down your mortgage, the extra your fairness goes up.

How Can You Get Down Fee Help?

Should you can’t afford a down fee, contemplate down payment assistance applications. Down fee and shutting price help applications are available nationwide, particularly for first-time homebuyers or homebuyers who meet sure revenue necessities.

“There are numerous down fee help applications accessible, relying in your state, metropolis and county, and an area lending specialist can offer you that data,” says Ann Thompson, retail gross sales executive-West, shopper lending, Financial institution of America. “There are additionally applications with the next rate of interest the place you may get partial bank-paid credit score to assist with closing prices.”

Some banks have particular applications for low- to moderate-income homebuyers, which can embrace down fee help and grants. “The purpose is to offer folks entry to credit score to assist meet down fee necessities,” Banfield says.

What Are Low-Down-Fee Mortgage Choices?

Should you can swing a down payment of any size, you’ll broaden your mortgage choices and save on curiosity costs. General, your mortgage prices shall be much less in the event you can foot even 3% of the mortgage worth as a down fee.

“There’s no free lunch,” says David Battany, vp of capital markets, Guild Mortgage.

Think about these low-down-payment mortgage choices:

Piggyback Loans

A piggyback mortgage is a second mortgage taken concurrently your main mortgage to cowl a considerable portion of your house’s buy value. It may be used to cowl a part of your down fee. This sort of mortgage can cut back the money it’s essential to buy a house and make it easier to keep away from non-public mortgage insurance coverage. A piggyback mortgage also can be sure that your mortgage quantity stays underneath conforming loan limits, which might make it simpler to qualify for a government-backed mortgage.

FHA Loans

The FHA affords a low-down-payment mortgage that permits you to put as little as 3.5% down. Debtors can qualify with credit score rating necessities which are extra lenient than typical low-down-payment loans. Your FICO rating should be no less than 580 to make a 3.5% down fee. For scores between 500 and 579, you’ll want a ten% down fee.

HomeReady by Fannie Mae

This program affords a 3%-down-payment mortgage for low- to middle-income homebuyers. That’s barely decrease than 3.5% for the FHA mortgage, however the credit score tips are more durable. Your credit score rating should be no less than 620 to get a HomeReady mortgage, and whether it is 680 or increased, you may get higher pricing.

Freddie Mac House Potential Loans

This fixed-rate mortgage has a down fee as little as 3% and lower-cost mortgage insurance coverage than on FHA loans. Freddie Mac’s Home Possible program is on the market for patrons with credit score scores of 620 or increased.

Typical 97

The Typical 97 Fannie Mae loan requires a 3% down fee and units no revenue limits. You’ll want a credit score rating of 620 or increased for this typical mortgage.

The Division of Housing and City Improvement’s Good Neighbor Subsequent Door program is for eligible academics, legislation enforcement officers, firefighters and emergency medical technicians. Eligible debtors should buy a HUD-owned single-family residence for 50% off its appraised worth.

The required down fee is as little as $100, and the customer should stay within the residence as a main residence for no less than three years.

View Extra Finest No-Down-Fee Mortgage Lenders

Best for government loans

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Based in 2008, PennyMac is a nationwide mortgage lender with greater than $473 billion in loans serviced. PennyMac affords a spread of residence loans, together with typical, Federal Housing Administration, Veterans Affairs and funding property mortgages.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened Fee, FHA, VA, ARM, USDA, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 0.03
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • PennyMac accepts a 50% debt-to-income ratio for typical loans in some situations.

  • On-line capabilities embrace a 24/7 entry heart and e-mail standing updates.

See full profile

Best for product availability

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Wells Fargo affords a wide range of mortgage and residential fairness merchandise in 36 states. The lender affords typical, adjustable-rate, FHA, VA, USDA, jumbo and refinancing loans.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened Fee, ARM, Jumbo, FHA, VA, USDA, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Debtors can select from a wide range of mortgage merchandise.

  • Wells fargo affords specialised loans with extra mortgage choices.

  • Debtors can get prequalified and apply on-line.

See full profile

Best for client relations

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SunTrust Financial institution, now often known as Truist, is predicated in Charlotte, North Carolina, and affords mortgages by means of branches in 15 states and Washington, D.C. Mortgage varieties embrace mounted or adjustable charge, typical, jumbo, refinance, Federal Housing Administration, Division of Veterans Affairs and Division of Agriculture.

Earlier than You Apply

  • Mortgage varieties: ARM, Typical, FHA, Fastened Fee, Jumbo Refinancing, USDA, VA
  • Minimal FICO credit score rating: Not Disclosed
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Presents FHA, USDA and VA loans.

  • Supplies a physician mortgage program.

  • Provides a web based mortgage utility.

See full profile

Best for fair credit

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Flagstar affords banking and lending merchandise in each state. Debtors can choose from typical or government-backed mortgages, akin to FHA, VA and USDA loans, and go for adjustable-rate mortgages.

Earlier than You Apply

  • Mortgage varieties: ARM, Typical, FHA, Fastened Fee, House Fairness Loans, Jumbo, Refinancing, USDA, VA
  • Minimal FICO credit score rating: 620
  • Most Down Fee: 10%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Flagstar Financial institution offers a broad collection of mortgages.

  • Some mortgages require no or a low down fee.

See full profile

Best for large loan amounts

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Financial institution of America serves roughly 66 million clients in all 50 states. The lender affords typical, Federal Housing Administration, Division of Veterans Affairs and jumbo loans, in addition to residence fairness traces of credit score and mortgage refinancing.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened, FHA, VA, ARM, HELOC, Jumbo, Refinancing
  • Minimal FICO credit score rating: Not disclosed
  • Minimal Down Fee: 5%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • Financial institution of America has a wide range of mortgage merchandise.

  • The lender affords origination charge reductions for qualifying Financial institution of America and Merrill Lynch purchasers.

  • House fairness traces of credit score haven’t any annual, utility or money advance charges or closing prices.

  • Financial institution of America affords a first-time homebuyer program.

See full profile

Best for no down payment

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Alliant Credit score Union is a nonprofit monetary cooperative. The credit score union serves clients in all 50 states. Mortgage merchandise embrace typical, jumbo and refinancing loans, and residential fairness traces of credit score.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened, ARM, Refinancing, Jumbo, HELOC
  • Minimal FICO credit score rating: Not Disclosed
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • No-down-payment mortgages can be found for first-time homebuyers with wonderful credit score.

  • Those that purchase or promote by means of the Alliant House Rewards program are eligible for money again rebates.

See full profile

Best for digital closing

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Assured Fee, based in 2000 and primarily based in Chicago, affords mortgage choices together with typical loans, Federal Housing Administration loans, jumbo loans and interest-only loans to clients in all 50 states and Washington, D.C. Debtors can make the most of specialised mortgage merchandise and Assured Fee’s on-line utility, documentation and mortgage fee choices.

Earlier than You Apply:

  • Mortgage varieties: ARM, Fastened Fee, Typical, FHA, VA, USDA, Refinancing, Jumbo, Curiosity solely
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 0.05
  • Higher Enterprise Bureau ranking: A-

Finest Options

  • Supplies qualifying debtors with a completely or partially digital closing course of

  • Presents a number of mortgage mortgage merchandise

See full profile

Best for Veterans Affairs loans

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USAA serves greater than 13 million members of the army and their households, providing monetary merchandise in each state and Washington, D.C. Qualifying debtors can get hold of mortgages, together with VA, typical and refinance loans. USAA is thought for its customer support and specialization in merchandise for service members.

Earlier than You Apply:

  • VA mortgage merchandise accessible: Jumbo, Refinancing, VA
  • Minimal FICO credit score rating: Not Disclosed
  • Minimal Down Fee: 0
  • Higher Enterprise Bureau ranking: A

Finest Options

  • Charges properly for customer support.

  • Presents VA Curiosity Fee Discount Refinance Loans, also referred to as IRRRL or streamline refinance.

See full profile

Best for online service

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Caliber House Loans of Coppell, Texas, affords mortgage and residential fairness merchandise nationwide. Choices embrace typical, adjustable-rate, refinancing, Federal Housing Administration, U.S. Division of Agriculture and Veterans Affairs loans. Caliber has been in enterprise since 2008, and is concentrated on residence lending merchandise.

Earlier than You Apply

  • Mortgage varieties: Typical, FHA, VA, USDA, Fastened, ARM, Refinancing
  • Minimal FICO credit score rating: 620
  • Minimal Down Fee: 3%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • The primary-time homebuyer program HomeOne can require a down fee of as little as 3% and debtors could qualify with a minimal 620 credit score rating.

  • Authorities-insured loans together with Federal Housing Administration, Veterans Affairs, and United States Division of Agriculture applications can be found.

See full profile

Best for VA loans

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Veterans United House Loans offers mortgages to veterans and army households in all 50 states and Washington, D.C., and makes a speciality of VA loans.

Earlier than You Apply

  • Mortgage varieties: Typical, Fastened Fee, ARM, FHA, USDA, Refinancing
  • Minimal FICO credit score rating: 640
  • Minimal Down Fee: 5%
  • Higher Enterprise Bureau ranking: A+

Finest Options

  • No down fee or mortgage insurance coverage is required for VA loans.

  • Presents FHA, USDA and VA loans.

See full profile

Promoting Disclosure: A few of the mortgage affords on this web site are from firms
who’re promoting purchasers of U.S. News. Promoting concerns could impression
the place affords seem on the positioning however don’t have an effect on any editorial selections,
akin to which mortgage merchandise we write about and the way we consider them. This web site
doesn’t embrace all mortgage firms or all mortgage affords accessible within the market.

https://loans.usnews.com/mortgage-with-no-down-payment | The best way to Get a No-Down-Fee Mortgage – Zero-Down House Loans

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