First Time Home Buyer Programs that Can Get You Into a New House
first time home buyer
A first time home buyer might find it difficult to get a good and affordable home to purchase. Seems like, so many factors have really compounded the whole matters. Hence, there are a lot of formalities and paperwork you must scrutinize before putting your signature. If you skip any of these steps, it may have financial implications which will not augur well for you.
There are some advantageous home buyer programs that may save you a lot of money. If you are in a rush, you might miss them. These include:
Down Payment Assistance Programs
Nevada is included as one of the states that offer down payment assistance. This particular program that we'll talk about here is specifically for a first time homebuyer. Although there are more down payment assistance programs
that do not require you to be a first time homebuyer, this one does!!!
By lender's definition, a first time homebuyer is one that has been a homeowner in the last 3 years. So long as you haven't been on a home title in the preceding 3 years, you are a first time homebuyer again.
This particular program I am referring to is on a first come first serve basis. They have a limited supply of funds in the amount of $50,000,000. Which seems like a lot, but not when people hear that will get 4% of the loan amount in free money applied towards the purchase. Also, these rates in comparison to other down payment assistance programs are about three-quarters of a point (.75%) less.
With every program, we always see pros and cons. With this one, the main con is there are maximum income & purchase price limits. Contact me to find out what they are!!! 702-271-1274. Mention this specific article and you'll receive your appraisal fee reimbursed after closing.
The minimum credit score for this exact program is 660. There is also a one time DPA fee of $625. The lender will include this fee as a part of your total closing costs.
FHA for everyone including first time home buyer
First of all, a lot of first time home buyers opt for this program. The Federal Housing Administration makes sure that a first time home buyer will get some amount of money for housing loans. FHA allows lenders to lessen their requirements for loan qualification. Hence, with the help of the FHA, first time home buyers and not only can now qualify for loans with as low as 3.5% payment.
There are mechanisms put in place by the FHA to help protect the lenders' money in case the borrowers fail to repay their loan. Such mechanisms include an upfront payment, ongoing additional cost, mortgage insurance premiums, etc.
The US Department of Agriculture also put in place a scheme to assist first time home buyers to buy new homes. The program is mainly for rural areas. There are full mortgage guarantees for lenders, thereby permitting adequate funding by the leaders. It does, however, have income limitations which change from one area to another.
Good Neighbor Next Door
The program was initially created for teachers and was tagged the Teacher next door. It has since been expanded to include government workers, working in other professions such as law enforcement, health, emergency, etc. The purpose of the Good Neighbor Next Door (GNND)
program is to improve the quality of life in targeted communities throughout the nation
The program gives a whopping 50% discount on the price listed for a home in places known as revitalization areas. The only condition is that you have to agree to live in the home for at least 36 months. You can find these listings on the Good Neighbor Next Door website.
The US Department of Veterans Affairs initiated the VA Loans. These enable service members, veterans or their relatives to purchase homes. There is usually no down-payment or mortgage insurance. The process of obtaining loans is tedious and time-consuming. Furthermore, VA lenders may add their own additional requirements which may not be so affordable.
Home Upgrade Programs
These allow you to get more value for your money. They include:
- The Energy-Efficient Mortgage Program: This program allows the lender to extend the loan limit when you make energy efficiency improvements to your house. There will be no change in the amount of down payment. The only condition is that you either buy a house with energy-saving improvements, or you upgrade your home's green features.
- HUD 203(k) Loans: This is specifically established for first time home buyers and not only who want to tackle a fixer-upper. They allow you to borrow money to make upgrades to a home as part of the main mortgage.
HUD acquires these are homes through foreclosures. HUD offers these homes for $1, or so they claim. The houses, however, may not always close with $1 down as a person must qualify for the payment and they are very limited.
The HUD Homestore lists HUD Dollar Homes which are properties that are now foreclosure homes. These homes are sold as-is and will not be fixed prior to the sale. This can make purchasing them somewhat inaccessible to a standard first time home buyer. Typically HUD home sales close via cash purchase. If they are not in bad disrepair and major issues are only cosmetic then a lender might lend on a HUD owned home. This is true if the appraisal does not uncover any structural damage. All standard appliances also need to be in the home. The home has to be inhabitable at the time of closing for a lender to sign-off on it.
If you would like to find out what might be available in your area, you can search the available HUD 1 Dollar homes on the HUD Homestore
Some homes at the HUD Homestore are 203k eligible. So if they require minimal rehab, it may be attainable through the loan process. Each listing will tell you if so.
Fannie and Freddie
Finally, Fannie Mae and Freddie Mac are government-back companies who work with lenders to provide appealing mortgage and loans such as 3% down-payments for first time home buyers.
More Help for a First Time Home Buyer
Apart from these national programs, states and local government do assist first time home buyers to get suitable homes. Furthermore, you can obtain more information about this from the Department of Housing and Urban Development.
If you need help choosing the right loan for your next purchase, contact Casey Moseman. She has the knowledge, experience, and dedication to service that makes her the ideal lending agent in Las Vegas!
Don't forget to read my article about teacher home loans
. You don't have to be a first time homebuyer. You must be a teacher for this one.
Call Casey Moseman 702-271-1274