Connect with us

Home Decor

Things You Need To Know About First-Time Home Buyer Programs



first-time homebuyers program

When it comes to buying a house, there is a lot you have to think about. Not asking the right questions can further lead to a number of unforeseen complications, which can easily be avoided.

If this is your first time buying a home, you can also enroll in a first-time homebuyer program. However, before you do that, it is best you learn some general knowledge and guidance about the same. This blog further explains who qualifies for such programs and the few types there are.

Types of First-Time Home Buyer Programs

Buying a house for the first time can be quite overwhelming, especially when it comes to costs. Fortunately, there are quite a few first-time home buyer programs you can choose from, assisting you with closing costs, down payments, and more. Here are some of the most popular first-time home buyer grants and loans.

  • Down Payment Assistance:

A down payment is a lump sum amount you have to pay when you are buying a home to secure your lot. This is an essential step for most kinds of mortgages. Luckily, the majority of lenders allow down payment assistance, which further helps you cover the upfront costs.

These programs are usually grants or have low loan interests that are exclusively designed for first-time homebuyers. The kind of assistance programs you actually qualify for can further determine how you are allowed to use the fund and if you have to pay it back.

  • Closing Assistance:

Very similar to the prior mentioned program, closing costs assistance will help you pay the closing costs on your first home buy. For those who are not sure, the closing cost is the extra fee that you have to pay after the mortgage process.

These costs usually make up about 2-6% of your entire home loan expense. Closing costs assistance, much like down payment assistance, can also come as a grant or loan. However, these are only a couple of loans and grants you can find in relevance to this topic. Keep reading to know more about the types of first-time homebuyer programs you can apply for.

  • Federal First-Time Home Buyer Programs
  • Local and State First-time Home Buyer Programs
  • Non-Profit first-time home buyer programs
  • Employer-Sponsored First-Time Home Buyer Programs

Who Can Apply For First-Time Home Buyer Programs?

Even if you are not living in your current property, if you own or are renting a specific property, you are ineligible for such programs. For government-backed loans like VA loans, FHA loans, or USDA loans, your home will have to meet the higher set standards in order to qualify.

Similarly, state government programs often have income restrictions. On the other hand, employer-sponsored programs are much more flexible. Qualification criteria for such programs entirely depend on the employer and state sponsor.

Several employer-state partnerships often use the 3-year rule to determine who gets considered as a first-time home buyer. If you are not yet sure about having the right qualification for the same, it is best you consult a reputable housing finance expert like Consumer Debt Counselors. They will surely look into your unique situation and offer solutions that help.

Benefits of First-Time Home Buyers Programs for Everyone

  • Variety of programs available to fit every budget
  • Some programs offer down payment assistance
  • Programs can help you become a homeowner sooner than you thought
  • A great way to start building equity and creating stability for your family
  • You don’t need a perfect credit score to qualify.
  • You can put as little as 3% down on your new home.
  • You can get financial assistance from the government to help with your down payment and/or closing costs. 
  • First-time home buyers often get preferential treatment when it comes to interest rates.  
  • There are many different types of first-time home buyer programs available, so you can find one that suits your needs.