Which loan allows a homeowner to purchase a home without immediate upfront payment of the entire price?

A purchasing money mortgage is a type of loan that enables a homeowner to acquire a property without needing to pay the full purchase price upfront. This financing arrangement allows buyers to borrow the money necessary to purchase the home while typically requiring a down payment, which can be significantly less than the total price of the home. The purchasing money mortgage often facilitates homeownership for individuals who may not have enough funds saved to make a complete cash purchase.

In contrast, a second mortgage is a loan taken out in addition to the primary mortgage, typically using the home's equity as collateral. A home equity line of credit gives homeowners access to funds based on the equity in their home, but it's not specifically intended for purchasing a home. A conventional loan usually requires a down payment and does not uniquely cater to the immediate needs of financing a home purchase like the purchasing money mortgage does. Thus, the purchasing money mortgage effectively addresses the need for homebuyers to secure financing without an immediate complete payment.