MANY DIFFERENT TYPE OF LOANS FOR FIRST TIME HOME BUYERS

Dated: 07/02/2017

Views: 357

Which one is right for you? 9 first-time homebuyer grants and programs

Buying a home for the first time can seem daunting. In addition to mountains of paperwork and new financial terms to sort through, you'll face costs and fees that can quickly add up.

1. FHA loan

With this option, the Federal Housing Administration (FHA) insures the mortgage. The FHA is an agency that operates within the U.S. Department of Housing and Urban Development (HUD).

Since the FHA insures the loan, lenders receive a layer of protection. First and foremost, lenders won't experience a loss if you default on the mortgage.

2. USDA loan

While not very well known, the U.S. Department of Agriculture (USDA) has a homebuyer assistance program.

The program focuses on residences in certain rural areas, but you don't need to purchase or run a farm to be eligible.

Through this setup, the USDA guarantees the loan. There may be no down payment required, and the loan payments are fixed.

Applicants with a credit score of 620 or higher typically receive streamlined processing. But there are income limitations, which can fluctuate based on region.

3. VA loan

The U.S. Department of Veterans Affairs (VA) helps service members, veterans and surviving spouses purchase homes. The VA guarantees part of the loan, which makes it possible for lenders to offer some special features.

VA LOAN offer competitive interest rates and require no down payment. You may not be required to pay for private mortgage insurance, and there isn't a minimum credit score needed to be eligible.

If it becomes difficult at some point to make payments on the mortgage, the VA can negotiate with the lender on your behalf.

4. Good Neighbor Next Door

The Good Neighbor Next Door program is sponsored by HUD and focuses on providing housing aid for law enforcement officers, firefighters and emergency medical technicians and pre-kindergarten through 12th-grade teachers.

Through this program, you could receive a discount of 50% off a home's listed price in specific regions known as "revitalization areas

Using the HUDHomes website, you can search for properties that are available in your state. As part of the program, you'll need to commit to living in the home for 36 months.

5. Fannie Mae or Freddie Mac

Fannie Mae and Freddie Mac are government-sponsored entities. They work with local lenders to offer mortgage options that benefit low- and moderate-income families.

With the backing of Fannie Mae and Freddie Mac, lenders can offer competitive interest rates and down payment amounts as low as 3% of the purchase price.

First-time homebuyers could also be eligible for home financing education programs with the "HomePath Ready Buyer" program through Fannie Mae.


6. Energy Efficient Mortgage (EEM)

This type of loan's purpose is to help you add improvements to your home that will make it more environmentally-friendly. The federal government supports EEM loans by insuring them through FHA or VA programs.

The key advantage to this grant is that it allows you to create an energy-efficient home without the need to make a larger down payment.  The amount is rolled into your primary loan.

Some improvements you can make include installing double-paned windows, new insulation and a modern heating and cooling system.


7. Federal Housing Administration 203(k)

If you want to purchase a fixer-upper, the 203(k) rehabilitation program may be a solid fit.

This type of loan, backed by the FHA, takes into consideration the value of the residence after improvements have been made. It then lets you borrow the funds you'll need to carry out the project and includes them in your main mortgage

8. Native American Direct Loan

Since 1992, the Native American Veteran Direct Loan program has helped Native American veterans and their spouses purchase homes on federal trust lands. The VA serves as the lender.

If you're eligible, you won't be required to make a down payment or pay for private mortgage insurance.

This first-time homebuyer grant also offers low closing costs and a 30-year fixed-rate mortgage


9. Local first-time homebuyer grants and programs

In addition to the grants and programs provided by the federal government, many states and cities offer help for first-time homebuyers.

Before purchasing a home, check your state or city's website for information on housing aid available in your area.

You might also considering contacting a real estate agent or local HUD-approved housing counseling agency to learn more about grants and programs that could fit your situation.

conventional loan is a mortgage that is not guaranteed or insured by any government agency, including the Federal Housing Administration (FHA), the Farmers Home Administration (FmHA) and the Department of Veterans Affairs (VA). It is typically fixed in its terms and rate.

Want to Advertise on this Site?

Latest Blog Posts

TOP 3 Questions To Ask Before Purchasing A 2nd Home

Top 3 Questions to Ask Before Purchasing a 2nd home1. How Much Will a 2nd Home Cost?Besides sales price, you should factor in mortgage, property taxes, insurance, utilities and maintenance.

Read More

Are You Ready For A Natural Disasters

Summer is peak season for climate-related disasters, and an alarming percentage of homeowners may be under insured to weather a natural disaster. Sixty-four percent of homes are

Read More

WORKING WITH PROBATE

IS FLORIDA A Uniform Probate Code (UPC) STATE Yes Florida is one of the  only sixteen states: Alaska, Arizona, Colorado, Florida, Hawaii, Idaho, Maine, Michigan, Minnesota,

Read More

Big Things Are Coming To Clermont Florida For Real Estate Investors

With Orlando Florida being the number one Vacation spot in the world, Investors are working hard to reserve properties now! Central Florida has Millions of Vacationers coming down throughout the,

Read More