MORTGAGES

First-Time Homebuyer Programs

When you’re not spending your time browsing Zillow and other websites, you may be thinking about whether you could afford to purchase a home. The states first-time homebuyer programs can help you make your dream of homeownership become reality. These programs provide assistance in settling the deposit as well as closing expenses and also offer affordable interest rates.

The most common eligibility requirements are that you never owned a home prior to (or within the last three years prior to submitting) and you must be using the property for your main residence and you must satisfy the requirements for income and credit scores.

To assist you in finding the best fit to meet your needs We’ll provide the most important first-time homebuyer programs across every state.

Key Takeaways

  • Every state offers a different form of down payment assistance, or low-cost home loans for first-time home buyers.
  • Typically, one is thought of as to be a first-time homeowner if they haven’t had a home for at least three years.
  • A lot of programs limit the amount of aid that can be provided in an amount equal to the price of a home or an amount that is set.
  • The state you live in may also have you complete an education for homebuyers to be eligible for a financing or loan.

 

Alabama

Step Up

Step Up Homeownership Program Step-Up homeownership program offers the assistance up to 4% of the cost of the sale (capped in at 10,000) in the form of Federal Housing Administration (FHA) loans, Department of Veterans Affairs (VA) loans and conventional loans that have been authorized by the housing finance authority of the state (HFA).

The applicant must use the loan to buy a new or an existing property in Alabama. Homebuyers are also required to apply for the FHA or HFA Advantage loan with an approved lender. Other conditions for eligibility include:

  • An annual income of less than $130,600
  • A debt-to-income ratio of less than 45 percent or less
  • An average credit score of 640 points or greater

Additionally applicants must also complete an homeownership course in order to be eligible for that scheme. 

 

Alaska

First Home Limited

It is a First Home Limited program assists buyers who are first-time homeowners who are located in Alaska. The main requirements are that applicants should not have had any primary residence within the last three years. This means that you could be eligible even if you’ve already bought a house. The three-year rule can be waived if the property is located in a designated region or if the applicant is a veteran who qualifies.

Note

Targeted areas are those determined as such by HUD. Department of Housing and Urban Development (HUD). Enter the street address on the Census Bureau form to determine.

The eligibility criteria are also based on income limitations, which are different depending on the location and whether the property is located in an area targeted for. The purchase price is restricted in areas that are not targeted For instance the maximum amount that is eligible of a single-family house in Juneau in 2022 is $425,192. 

 

Arizona

HOME+PLUS

It is the The HOME+PLUS Home Buyer Down Pay Assistance Program is run through the Arizona Industrial Development Authority. It offers a fixed rate for a 30 year mortgage and up to 5 percent down payment assistance for those who struggle to save enough funds to cover a down payment as well as closing expenses.

To qualify, applicants must earn an annual income that is less than $112,785 as well as score at minimum 640. Additionally, at least one borrowers needs to have completed a homebuyer’s education course prior to closing. Furthermore Down payment assistance programs may only be used with a mortgage called HOME+PLUS. 

 

Arkansas

ADFA Move-Up Loan Program

It is the Arkansas Development Finance Authority (ADFA) Move-Up Loan Program gives 30-year mortgages at fixed rates and without a penalties for prepayment. It must be the first loan you take out, however it could be an FHA conventional, FHA, Rural Development, or Department of Veterans Affairs (VA) loan. The borrower must buy a house with a value of less than $424,000.

This Move-Up Program can also be coupled with other state incentive programs. For instance The Mortgage Credit Certificate Program offers first-time homeowners the opportunity to receive a tax credit that can be as high as 35% of annual mortgage interest and up to the maximum amount of $2,000 per year, so long as the property is the primary residence of the buyer. 

 

California

CalHFA FHA Program

There is a California Housing Finance Agency (CalHFA) offers the FHA plan for home buyers who are first-time buyers which includes an FHA-insured 30-year loan with a rate that is fixed. Properties that qualify must be the primary residence of the borrower and can include manufactured homes, single-family houses, and certain condominiums.

The borrower must also undergo the online or in-person homeowner education counseling and then collect a certification of the completion. 5 Income limits differ based on the area of the house and the county in which it is located. For example the case of San Bernardino County, the maximum amount that can be considered a qualifying income is $153,000. 

 

Colorado

CHFA Down Payment Assistance Grant

The Colorado Housing and Finance Authority (CHFA) provides the down assistance grant that can be up to three percent of a first mortgage loan without requiring repayment. For instance, a borrower could get up to $7500 in down payment assistance an interest-only fixed rate of $250,000 for a 30 year period. 7

The borrower must have a minimum credit score of 620, meet income guidelines, and have completed an education course for homebuyers. In addition, they need to contribute at least $1000 to the cost of buying a house. 

the authorAaron Krause

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