First Time Home Buyer Programs
Are you a first time home buyer looking for credit assistance that can offer you many benefits? You can choose from many of the best home loans for first time buyers. How do you know which assistance programs will be right for you and your down payment? Let’s start with your eligibility.
Are you a first time home buyer? It is vital to meet the definition of this type of buyer to benefit from this simple guide to these programs. And the government and private organizations alike offer these types of programs. Your Real Mortgage Consultant at Winner’s Mortgage can help you determine what program is the smart choice for you.
Do You Fit Here?
A first time home buyer can receive extra benefits compared to other types of buyers. And this includes reduced interest rates and helps with closing costs and the down payment. Moreover, learn more about what these benefits are as you read along. Also, see the article “First-time homebuyers who want to own their own home” here:
Definition of a First Time Home Buyer
A first time home buyer is defined by the US Department of Housing and Urban Development or HUD. The department sets up criteria to assist lenders to identify first time home buyers. And the criteria include the following:
- A person who has never held ownership of a principal residence during the span of the 3 years ending on the purchase date
- A displaced homemaker who members who only owned a home together with a spouse
- A single parent who owned a home with the former spouse and wants to purchase one after separation
- A couple who have never owned a house before (where one was a homemaker, and one has never owned a home before)
- A person with a principal residence but without a permanent foundation (an example of this is a mobile home)
- A person with the owned property but not in compliance with local, state, and model building codes (This means that the property cannot be made into compliance for less than the costs of a permanent structure construction)
A first time home buyer is qualified for down payment assistance programs. One of these programs is offered through the Federal Housing Administration. And these programs offer benefits to first time home buyers. To know more about the criteria from HUD, visit this site.
Following these criteria, can you take the credit and call yourself a first time home buyer? And do you want to know the best home loans for first time buyers like yourself? Check out excellent down payment assistance programs from this section.
Benefits that First Time Home Buyers Enjoy
If you do qualify with the HUD criteria, you can enjoy some benefits. Moreover, a first time home buyer can take advantage of these benefits:
Down Payment Assistance
A first time home buyer benefits from down payment assistance from specific programs. However, these programs will require a small down payment if the zero-down option is not available. But this is only applicable if you qualified for the programs.
First time home buyers get cash as grants for expenses related to the home purchase. And some examples of expenses include closing costs and down payment.
Closing Fees Assistance
One of the benefits that a first time home buyer enjoys is the closing fee assistance. Some credit programs cap the number of closing costs for these buyers.
Better Interest Options
First time home buyers have better credit choices compared to other buyers. You can save on interest because some organizations subsidize it. And some even help first time buyers qualify for loans with lower interest rates.
If first time home buyers have difficulty with the loan payment, they won’t be charged with interest. Moreover, they are given the chance to sell the property before being asked to repay the mortgage.
First time home buyers can benefit from loan forgiveness. So this means that those who have stayed in the property for a period can have the debt canceled.
These benefits vary depending on the wide variety of first time home buyer programs available. But none of them are guaranteed with any specific program.
All these benefits that a first time home buyer can get will depend on several factors. Some require excellent credit scores while others depend on income and debt ratio. But these will also depend on the lender and the type of program.
Basic Process of Home Purchase for First Time Buyers
If you are a first time home buyer looking for great credit programs, start with learning the process. Let’s explore what you should expect when purchasing a home for the first time. So here are the basic steps of the process.
Step 1: Analysis of Your Situation & Possible Best Options
The first step is to ask for the assistance of the Winner’s Mortgage Real Mortgage Consultant for cold, hard facts. When consulting an expert, you get to have information about what to expect. And filling out Winner’s Mortgage Client Questionnaire is the first step.
There are many financing options you can secure from the market. And like every market, it is a mix and match of excellent and bad offers. If this is your first time purchasing a property, it is a great opportunity to explore.
First time buyers get access to incredible offers like down payment assistance programs. So you get to be easily qualified for a lot of credit programs. And some of the best offers for first time home buyers are available here [link to the last part of the article].
A consultation with a dependable Real Mortgage Consultant from Winner’s Mortgage will provide you with the best options. There are different factors to consider and it’s not just the interest rates. So if you want to learn more about how to choose a mortgage, visit this page.
Your Real Mortgage Consultant will discuss options that are smart choices for your situation. The Client Questionnaire will be a big help with that. In addition, you will also need to provide your credit report with it. The next step is the “Get Acquainted” meeting. And the meeting will either be in the office or online through Zoom.
In the meeting, your consultant will also discuss the required documents. After choosing the program and interest rates, you will have your pre-approval letter. Next, dditional instructions and clarifications are also discussed.
This will show how a Real Mortgage Consultant is the right choice, not just a typical run-of-the-mill loan officer, more information is at this link.
Step 2: Planning and Choosing a Real Estate Agent
A credible Winner’s Mortgage Real Mortgage Consultant will connect you to real estate agents with access to properties suitable for you. He will help you find a great home considering your needs and wants. Learn more about this process here.
After finding the home you want, here are the steps you can expect in the process:
- The seller accepts the purchase offer
- Make an offer with an inspection contingency
- A sign purchase agreement with seller and real estate agent
- Confirm purchase offer with a home inspection
- Receiving inspection report
- Discussion of possible options together with a real estate agent
- Decide if you will proceed, negotiate, or do not proceed with the purchase
First time home buyers are recommended to look for a property they can add value to. In addition. you can even choose a property you can revamp. Just make sure to choose wisely. The real estate agent that the Real Mortgage Consultant will connect you with will help plenty in this step.
Step 3: Loan Application Proper
If you choose to move forward, the next step is the application proper. But you need to send the necessary and additional documents for the process. Besides the loan application you will need to sign, here are other documents you can expect:
- Loan Estimate Form
- Title Opinion and Title Insurance
- Appraisal Report
- Employment and Bank Account Verifications
- Tax Transcripts
The lender will receive all these documents for processing and underwriting.
Step 4: Underwriting
The next step is the underwriting process. This means conditions will either be approved or negotiated. And being a first time home buyer, this will require assistance from an expert.
This step will also be on a case-to-case basis, depending on the borrower’s program and situation. And it is vital though to lock your interest rate to be sure that the loan will be funded.
Step 5: Closing
First time home buyers are new in this process and would need assistance. And this step is a crucial one to accomplish and would require a more meticulous touch. Therefore, consultants like Winner’s Mortgage will be highly beneficial.
Step 5 is the final step of the process. The closing refers to the signing of paperwork after confirming the deal. Consequently, this happens after the offer and home inspection to formalize the entire deal.
Take note of these five steps as it is necessary to learn about them. Whether you are one of the first time buyers in search of the best home loans or not, this is vital.
As a first time home buyer, you have a lot of questions. And here are the answers to some of your mortgage questions when it comes to home mortgages.
Do the first time home buyers have an income limit to qualify?
In applying for a credit program, a first time home buyer will need to consider their income. However, when you apply for mortgage assistance, income limits are a vital consideration.
The income qualification depends on lenders and the program you are applying for. So if you belong to low- and moderate-income households, you are qualified for more programs. In addition, your DTI (debt-to-income) ratio is also considered.
How can I qualify for down payment assistance?
If you want to qualify for down payment assistance programs, being a first time buyer is a good deal. And get the help of Winner’s Mortgage and to help you look for the best programs. Don’t settle for less and expect to get the job done.
How do I apply for a first time home buyer grant?
One of the benefits of applying as a first time home buyer is access to grant programs. In fact, low- and moderate-income borrowers can benefit from forgivable loans and grants. And you can qualify for grants by being either one of those two types of borrowers.
How can I find the best loans for first time home buyers?
You can find the best home loans for first time buyers by consulting experts. The leading Winner’s Mortgage can connect you to the best programs most suitable for you.
5 Simple Tips First Time Home Buyers Can Use
Being a first time home buyer has its benefits and disadvantages. And one of the disadvantages is the lack of information and experience. But to help you in this process, here are 5 simple tips.
1. Review your financial health before applying for a mortgage
As a first time home buyer, review your financial health, including your credit and income. Buying a house and getting a mortgage demands an excellent financial standing for the best loan terms. And this will be a vital factor in the purchase and the lending process. But here are some things you can do.
- Carefully assess your expenses – Do you have enough income remaining each month so that purchasing your own home does not become a burden?
- Remember your savings – Do you have enough savings to accomplish the home purchase, plus have a reserve fund for the extra expenses of homeownership, plus an emergency fund?
- Check on your credit standing – The better your credit, the better terms you can get on your financing.
2. Be specific about the features you want your home to have
In imagining and purchasing your dream home, it is important to be specific. So, list down the features you want your home to have before scouring the market. And before having access to the best home loans for first time buyers, you should first know what you want.
3. Choose the type of home that will benefit you the most
In addition to the features of the home you want, consider the type of property you will purchase. From a traditional single-unit home to a townhouse, decide on the type before applying for a mortgage.
4. Check the amount of mortgage you can qualify for and can afford
Another tip is to consider the amount you can afford and the mortgage you can qualify for. So make sure to match both amounts to the price of the property you’re buying. And don’t forget to include all the costs and extra fees to process the entire transaction.
Another thing you can do is to work with a credible Real Mortgage Consultant who will be sure you get a real pre-approval, not just a worthless pre-qualification. See more here.
5. Look for an expert guide to help you through the purchase
Ask the help of an expert in the transaction. As a first time home buyer, like any home buyer, you will benefit from the assistance of a professional. And to start with, consult Winner’s Mortgage for a real pre-approval and assistance in choosing which programs will benefit you the most.
Loan Program Options for First Time Home Buyers
It can be incredibly challenging to purchase a property alone. And it is even more challenging for a first time home buyer even with many benefits offered for them. However, a first time home buyer can apply for credit programs with down payment assistance.
Even before checking the benefits of these programs, make sure you qualify for them. So go back to the definition of a first time home buyer discussed in the first part of this article. And for supplemental information, check out this page too.
Here is the selection of the best home loans for first time buyers. And as a first time home buyer, weigh the benefits and disadvantages of each mortgage program. Finally, choose one that can benefit you the most with the assistance of your fully-trained Real Mortgage Consultant at Winner’s Mortgage.
30-year Fixed-Rate Mortgage
The 30-year fixed-rate mortgage provides the most security against interest rate changes. And since the rate does not change over the term of the loan, it allows borrowers to plan and budget for the long-term.
Most first time home buyers regard this mortgage as one of the best loans for them. But with fixed rates, borrowers can expect stable monthly principal and interest payments. Consequently, this mortgage is easier to handle and more predictable than others.
A 30-year credit program can be an excellent choice for a first time home buyer. It offers the chance for a lower monthly payment and more flexibility in your monthly budget. And more information about this mortgage can be found here.
The FHA loan is guaranteed by the Federal Housing Administration. And it is one of the down payment assistance programs in the market, requiring only a minimum of 3.5 percent.
A first time home buyer also benefits from the mortgage’s lenient qualifications. In addition, borrowers can possibly be approved for the loan even with a 500 to 579 credit score. With this credit score, additional requirements will include a 10% down payment and MIP (mortgage insurance premium).
To consider the FHA loan, learn more about this mortgage here.
The VA loan is guaranteed by the U.S Department of Veterans Affairs and offered to the military community. So if you a first time home buyer in need of assistance, you can try this mortgage as long as you qualify.
This can be considered one of the best home loans for first time buyers due to several factors. And qualified borrowers can enjoy no down payment and no premium mortgage insurance. However, VA does charge a one-time upfront VA funding fee. And these factors can be very helpful to first time home buyers.
If you think you meet the eligibility requirements as a veteran or qualified family member, the next step is to learn about the entire process. And to know how this credit program can help you as a first time home buyer, visit this page.
Native American Direct Loan
The Native American Direct Loan or NADL is a mortgage guaranteed by the Veteran Affairs. So if you are an eligible Native American veteran, this mortgage is an excellent consideration.
Just like the VA loan, this credit mortgage is an excellent choice for a first time home buyer. And this is a good opportunity for buyers who want to have homes on federal trust land. The benefits include no mortgage insurance, no down payment, and low closing costs.
Compared to the VA loan though, the NADL is funded by Veteran Affairs. Through this mortgage, a first time home buyer enjoys many benefits. To learn more about the program, check out this page.
The USDA loan is offered to borrowers belonging to low to medium-income households. Guaranteed by the Department of Agriculture, this mortgage promotes properties in rural areas. And this is one of the best home loans for first time buyers looking for a rural property.
Compared to other down payment assistance programs, it has strict qualifications. An eligible property should be in rural areas. This also depends on the state where the rural area is located.
To have access to a more thorough guide in applying for the USDA loan, visit this page.
Energy-efficient Mortgage (EEM)
A first time home buyer benefits from the energy-efficient mortgage. A type of FHA program, it combines property purchase and renovation at the same time. This is how this can serve as assistance for a first time home buyer.
EEM focuses on upgrades and renovations targeting energy efficiency. This is also known as green upgrades. It is backed by the VA or FHA programs. More information about this mortgage is available here.
FHA Section 203(k)
The FHA Section 203 (k) loan is also known as a rehab loan. Another one of the best home loans for first time buyers is a home purchase and renovation loan rolled in one. If you have the image of your dream home set in your mind, this is the right loan to explore.
A first time home buyer looking for a fixer-upper property benefits from this. This loan program is an all-in-one offer to provide for a more streamlined renovation process.
If you are a first time home buyer in need of assistance, and you’re interested in a rehab home loan, check out this page.
Good Neighbor Next Door Program
The Good Neighbor Next Door Program offers first time home buyer assistance to:
- Law Enforcement Officers
- Emergency Medical Technicians
This credit program fits a first time home buyer due to a possible 50 percent discount. Provided by the U.S. Department of Housing and Urban Development, it has standards you must follow. Learn more about what this entails through this site.
Fannie Mae’s HomePath ReadyBuyer Program
Fannie Mae’s HomePath ReadyBuyer Program is a conventional mortgage. This program requires only a 3 percent down payment. It is one of Fannie Mae’s down payment assistance programs. Check it out by visiting this site.
Freddie Mac also offers a similar loan program through its Freddie Mac Homesteps. If you want to learn more about it, visit this site.
Both loan programs require a low down payment. However, both also require strong credit from the borrowers.
State and Local First-time Homebuyer Programs and Grants
First time home buyers can also benefit from state and local grants and programs. These offers will vary depending on the city, county, and state you are in. They help with down payment and closing costs.
Many cities and states offer these grants to attract new residents. Since programs vary from one state to another, the better option is to consult an expert. Contact your Real Mortgage Consultant at Winner’s Mortgage to start your process. Don’t gamble. Bet on a winner.
These are the best home loans for first time buyers. If you are still hesitant to take the first step, contact Winner’s Mortgage for gold standard assistance along the way. This is a good start so that you now know what to expect in the process.