Do I Qualify for Any First-Time Home Buyer Programs?

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Many young adults want to buy homes, but face overwhelming barriers when it comes to affording down payments and navigating the complex world of financing. Fortunately, there are many first-time home buyer programs that are meant to give people the leg up they need.  If you want to buy a home but aren’t sure if you are financially ready, consider whether any of these loans, mortgages, and grants will be right for you. 

Look for HUD Programs in Your State

Options for first-time home buyers vary by state. To filter through your state’s options, use the Department of Housing and Urban Development (HUD) website. Search by state to find a list of programs and grants that might be right for you. You can find a list of programs by selecting your state and scrolling to the Homebuying Programs section under Local Resources.  

See if Your Qualify for FHA Loans

The next step in your grants search is to look into Federal Housing Administration (FHA) loans. The FHA was actually developed by HUD as a way to increase homeownership in America. In fact, 82% of FHA loan candidates were first-time home buyers.  The Lenders Network created a valuable infographic you can check out to learn more about this option. They cover questions related to credit scores, interest rates, and other requirements that you will need in order to qualify for this loan. 

Veterans Affairs Home Loans

The Department of Veterans Affairs offers home loans to active duty members, veterans, and their spouses in some cases. Many of these loans have little to no interest rate as a way to help service members build a life after they leave the armed forces.  While private banks and mortgage companies supply the loans, the VA guarantees the loans as a way to protect the investment. This extra stability means that banks are more likely to approve the loan (because it is considered a loan to the VA) than if the loan request came directly from the service member. This is how recipients of this loan are able to get much lower interest rates than they otherwise would have.  

Explore the Good Neighbor Next Door Program

Another niche home loan option that you can consider based on your profession is the Good Neighbor Next Door Program which was developed by HUD. This program is available to law enforcement officers, pre-K-12 teachers, firefighters, and emergency medical technicians. The goal is to make neighborhoods safer by lending to people who the community can trust.  The benefits of the Good Neighbor Next Door Program are significant. Homeowners can save up to 50% off the list price of the home. In exchange, they must live in that area for at least 36 months. There are specific listings to check to find homes in revitalization areas in your state. By living there, you can contribute to making the local community better. 

Fix Up a Home With an FHA 203k Loan

Some loans are meant to help certain demographics, while other loans target specific housing types. The FHA 203k loan is meant to incentivize homeowners to buy fixer-uppers or homes that are in significant need or repair. The loan is combined into one, and it covers both the necessary funds for a downpayment and the money needed to improve the home.  For example, a home that would otherwise sell for $250,000 might actually sell for $100,000 because it is in such bad shape. While this is a deal for the buyer, they will likely spend more than $100,000 over again repairing and updating the home. An FHA 203k loan would help with this, so a homebuyer wouldn’t need to pay for renovations with a second loan.  This first-time home buyer program benefits communities as well as homebuyers. When more houses are fixed up – instead of left to rot – the overall value of the area improves. The goal is to get “eyesores” off of the market and keep neighborhoods safe and healthy.  

Move to a Rural Area with a USDA Loan

The United States Department of Agriculture offers loans for people who want to move to a USDA-eligible rural area. This doesn’t mean you need to buy and farm or raise livestock, but you do need to move to a qualified rural area.  These loans have income limits based on where you live as a way to help lower-income earners buy a home. You may need to do some research to see where in your state the USDA loans qualify and what the maximum income levels are. 

Use an Experienced Realtor® to Find First-Time Home Buyer Programs 

If you are ready to buy a home, it is important to work closely with a Realtor® who can help you. There are many real estate professionals who specialize in working with first-time home buyers. They spend a significant amount of time educating them and answering any questions that might crop up and they can help you find first-time home buyer programs.  Check out our system at to find a Realtor® who meets your needs. We have a data-backed algorithm that allows you to input specific criteria and sort through Realtors® until you find the right person for you. The right Realtor® will help you save money and better understand what goes into buying a house.  Photo Credit: francesca-tosolini-21xbUDIN8ao-unsplash

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