Based on wise saying, the requirements to buying a house starts with having 20% as a down payment. However, what happens when you don’t have a huge pile of money sitting in a bank account? Instead, of continuing to rent, there are plenty of alternative options to take. Charleston Home Team Real Estate is here to help first time home buyers purchase a home.
5 First Time Home Buyer Programs to Check Out
Here’s some good news for first time home buyers. The average down payment is around 6% of the purchase price. This is according to the National Association of Realtors®’ annual Profile of Home Buyers and Sellers. However, coming up with a large amount of money can be tough when first starting out. Here’s a list of first-time home buyer assistance programs you should check out to help you buy a house.
- FHA Loans
Offered through the Federal Housing Administration, this program helps first time home buyers. It allows families to purchase a house with as little as 3.5% down. However, be aware of the mortgage insurance requirement for this type of loan.
In a conventional loan, you’re not required to pay mortgage insurance once there’s 20% equity in your home. FHA loans requires you continue paying mortgage insurance for the life of the loan. However, you still can’t beat the low down payment when your short of cash.
- VA Loans
If you’re an active service member of the US military or a veteran, you qualify for this type of loan. National Guard members, and spouses of military members who died while on active duty may also apply. They offer 100% financing with no down payment.
There are some things to consider when applying for VA loans. First, you’ll need a certificate of eligibility and a good debt-to-income ratio. There are some VA and lender guidelines that must be met for credit score. However, you don’t need to buy private mortgage insurance.
- USDA Loans
Besides certifying beef, the U.S. Department of Agriculture also help first time home buyers with the down payment. They offer 100% financing with no down payment. However, there are also some restrictions to keep in mind.
The home must be in an area where the population is less than 35,000. The loans are only available to families who doesn’t have current safe housing. Plus, you must have an adjusted income at or below the local limit.
- National Homebuyers Fund
This program is designed to help families with low-to-moderate income. It provides down payment assistance by issuing a nonrepayable grant up to 5% of the loan amount. Their Sapphire program is available in multiple states and offers generous FICO score requirements.
- Local Programs
There are many local programs for first time home buyers in the Charleston area. Here’s one to consider from The S.C. State Housing Finance and Development Authority. They provide federal income tax credit to qualified first time home buyers. They offer up to $2,000 per calendar year for every year the home is used as their primary residence.
Contact Us for More Info about First Time Home Buyer Programs
Don’t become stressed out worrying about how you can come up with a large down payment. Let us help you by being your personal guide to your first home. At Charleston Home Team Real Estate, we strive to ensure your home buying experience is stress-free. Contact us at (843) 628-3960 for more information about first time home buyer programs today!