Multiple home buying programs offer incentives for first-time homebuyers

Did you know that there are several home buying programs designed to offer financial assistance to first-time homebuyers? Let’s look at a few of them, and what makes them different.

Home buying programs

  • EEM (Energy-efficient mortgage) loans, insured through the FHA or VA program, allow the homebuyer to create an energy efficient home (new windows, insulation, heating system, etc.) without the need of a larger downpayment.
  • Fannie Mae and Freddie Mac are government agencies that work with low- and moderate-income families and offer competitive interest rates and a low downpayment option.
  • An FHA (Federal Housing Administration) loan helps protect the lender if the borrower defaults on the mortgage. FHA loans have competitive interest rates and typically require a smaller downpayment and lower closing costs.
  • An FHA Section 203(k) loan, backed by the FHA, allows those purchasing a fixer-upper to include home improvement funding in their mortgage. Another feature is a low downpayment requirement.
  • The Good Neighbor Next Door program, sponsored by HUD, offers benefits for law enforcement officers, firefighters, EMTS and teachers purchasing in designated “revitalization areas.” HUD also offers a a first-time homebuyer program and a Dollar Home Program featuring foreclosed FHA homes.
  • A HomeReady HomePath Mortgage requires first-time buyers to complete an educational course in exchange for benefits such as a low downpayment requirement.
  • The Native American Veteran Direct Loan program, designed for Native American veterans and their spouses, features no downpayment, no private mortgage insurance and low closing costs.
  • A USDA (U.S. Department of Agriculture) loan is focused on certain rural areas. The loan is guaranteed by the USDA and there may be no down payment requirement. Income limitations apply.
  • VA loans issued by the U.S. Department of Veterans Affairs assist members of the military, veterans and surviving spouses. VA loans offer a competitive interest rate and do not require a downpayment.

Many cities and states also offer assistance for first-time homebuyers. For more information on home buying programs, please contact The Olear Team today!

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