Buying a home is no easy task, and if you’re currently in the process of looking for a home to settle into, you may already be aware of how stressful it can actually be.
Everyone has questions, especially if it’s their first time encountering the housing market, and thankfully, we can offer answers to just about anything that’s been troubling you in regard to buying a home.
For example, you may want to learn more about how you can get assistance with a down payment or even avoid paying one entirely, whereas others may need help with understanding how closing costs work.
No matter how you look at it, buying a home is a complex process, and every bit of help is a godsend to an amateur home buyer looking to purchase their first property.
We’ll go over some of the grants, loans, and assistance programs that have been made readily available to first-time home buyers, and you’ll be able to find out what options are available to you.
First-time home buyer programs
At first, the costs you’ll encounter can seem overwhelming, and it’s what usually drives people away from the current housing market, but they’re often unaware of the assistance options they can make use of.
The government offers several different loaning programs that can help with the down payment on the home or the closing costs for the mortgage, and sometimes, it’s even in the form of a grant.
On top of this, there are both government-sponsored and independent education programs to help you familiarize yourself with the current state of affairs in the housing market and get the most out of the money you were planning on spending.
Keep reading to learn more about the types of assistance you may qualify for.
DPA, loans, and tax deductions
When buying a home, the down payment is one of the biggest initial expenses you may encounter, and it’s a fairly common thing for most mortgages, although it’s omitted with the help of some programs.
Thankfully, even if the mortgage you applied for does require one, you can get assistance with the payment, and most programs will offer you an extremely low-interest or a no-interest loan to help you cover this expense.
Sometimes, you can also take out a second mortgage to help cover the down payment, although you will be required to pay it off within the same period as your first mortgage.
Other times though, you can apply for a government-backed loan to help you purchase a home, and these mortgages come without a down payment, at least on your part, as it’s included in the loan if you’re approved.
While the Housing and Economic Recovery Act did end over a decade ago, there are still ways to save some extra money when purchasing a home.
This is done with the help of tax deductions, which are used to deduct the entirety of your mortgage from your federal taxes if the mortgage itself is under $750k.
Federal programs that offer assistance
Apart from the down payment loans that were mentioned above, the federal government offers a variety of programs for first-time home buyers, and applications are open for any legal resident of the US.
Despite this, you may still not be able to qualify for each of the programs out there, as they come with a set of requirements, including location, income level, employment history, and many many more.
With government-backed loans, you can purchase a home even if your credit score is abysmal, with the payoff to the lender being that the government has ensured the loan, meaning that if the borrower defaults on it, they’re going to get their money back.
This also means that they can offer a much lower interest rate to borrowers, allowing them to compete with other lenders on the market, and you’ll find that there are many loaning options like this available in the US.
Other programs will instead focus on creating communities with qualified professionals living in them, and these individuals can qualify for assistance through the Good Neighbor Next Door program.
The program can offer police officers, teachers, and EMT technicians up to a 50% discount on qualifying HUD properties, so long as they’ll make it their primary residence.
First-time home buyers have access to a number of assistance options, all of which can make the process of purchasing a home significantly easier than it would be should they be going through it on their own.
From tax deductions to government-backed loans, the options are endless, and as long as you’re able to qualify, it’s highly likely you’ll be eligible for support.
Apart from the government-backed programs, there are dozens of charitable and non-profit organizations looking to help people just starting out on the housing market, and you’d do well to explore these options further.