For many, there is still a great deal of importance attached to purchasing a home. However, buying a home for the first time can be a difficult thing. You need to make sure that your credit score is good, and that you have a down payment. While the credit portion may be doable for many, there is a little more difficulty when in comes to the down payment. Young people buying a home for the first time might have a hard time scraping together the down payment needed to help them get the best interest rate, or make their mortgage more affordable. The good news is that there are first time home buyer programs designed to help.
Local and State Grants and Mortgage Loan Programs
Some cities and states offer grant programs for first time home buyers. These grants and special loan programs are aimed at helping first time home buyers afford a home, and reduce the time spent paying PMI (or avoid it altogether). You might qualify because of your income, or just because of your status as a first time home buyer. Before you make a decision, check to find out what first time home buyer programs might be available in your city or state.
Sweat Equity Programs
Many neighborhoods and builders have sweat equity programs. If you are willing to do some of the work to help build your home, the time and effort you put in goes toward a down payment, lowering what you borrow and boosting the equity, or ownership, you have in your home. Neighborhood sweat equity programs often require that you help on other houses, as well as on your own. It’s worth looking into, though.
Federal Grants and Loan Programs
While the federal government doesn’t offer specific first time home buyer programs, there are still opportunities that are ideal for those buying a home for the first time. The USDA offers special options for those who purchase a home in what is considered a rural area. First time home buyers can find this especially helpful, even though others can take advantage of this program.
And, of course, there are FHA loans. These loan are open to anyone, but many first time home buyers find the low down payment requirement helpful. You can get good financing terms as well when you opt for a FHA loan. It is definitely worth looking into if you are a first time home buyer.
You have options when it comes to first time home buyer programs. Make sure you consider what’s available, and get the help you need.