First-Time Homebuyer Programs in Your State

Apr 4, 2022First-Time Home Buyers

First Time Homebuying

Homeownership has been a part of the American way since the founding of this country. Owning land and a home offers a sense of pride and stability in life, but it comes at a hefty price. Because the purchase of a first home can be challenging to achieve for millions of Americans, first-time homebuyer programs have been created across the country.  These programs can provide the extra boost to help someone overcome financial barriers in the homeownership journey.

Offered at the federal and state level, first-time homebuyer programs come in a variety of forms, and are often specific to low-income, moderate-income, or first-time homebuyers. Income limits for some loan programs are surprisingly high. The cost of buying a home often surpasses people’s expectations between the home improvements, closing costs, and other variables that are involved in a real estate transaction. These programs offer support in finding flexible loan terms, closing cost assistance, and down payment support. Some cities and towns also have incentives for prospective homebuyers to purchase their first home. Homebuyers should retain experienced guidance from an experienced buyer agent.

Buying your first home and taking that step towards building equity is exciting, but it can be overwhelming to understand all the support available to you. Thankfully, NAEBA members are available to help guide you through the process because they’ve done it with other homebuyers for over 26 years. Walk through the homebuying journey with confidence by using an exclusive buyer’s agent that has your best interests at heart.

Because many of these programs are specific to first-time homebuyers, it’s important to consider  all options if you’re searching for the first place to call home so you don’t miss the opportunity.

What is a First-Time Homebuyer Program?

First-time homebuyer programs are intended to help individuals  looking to purchase their first home. These programs are offered at the state and federal levels in a variety of forms, but there are often specific eligibility requirements for each program. Some of these conditions include minimum credit scores, maximum home prices, educational courses, maximum income, caps on the amount of the loan, and occupation or veteran status. Each program is unique, but they often support homebuyers with loans, down payments, closing costs, and more. A lower required down payment is often what is most appealing to first-time homebuyers. Prospective homebuyers are often surprised about how much money they can earn and still qualify. There are also home-buying incentives often by some cities and towns.

What Types of First-Time Homebuyer Programs Are Available?

It’s best to review the types of support offered through these programs before diving into the details of how they work. There are many programs in existence and they each operate a little differently so it’s essential to know what’s available  in case you qualify for multiple levels of assistance.

Down Payment Assistance

A common area of support at a local level is down-payment assistance to kick start the process of getting a loan. Saving 20 percent of a mortgage loan apart from transaction costs and initial home improvement can be challenging, so down payment assistance is there to make it more accessible. This support often comes in the form of a grant or loan, depending on the location. The loan, equivalent to the down payment amount, will often be called a second mortgage that offers low-interest rates and deferred payments.

Government-backed Loans

Having the government backing a loan minimizes the risk involved for a lender to provide a loan; therefore, allowing lenders to offer more flexibility in the terms for a borrower. Many lenders partner with the government to provide loans to borrowers who meet minimum criteria. These loans are typically found at a local level.

Loan Forgiveness

A few states, like Ohio and Maryland, offer loan forgiveness to help someone purchase their first home. The most common example of this is student debt related to school loans. The programs help forgive those loans so that a person can use their income towards a mortgage or down payment, depending on the program.

Closing Cost Assistance

Closing costs  can be a significant financial hurdle for many first-time homebuyers and often amount to more than expected. Just as down payment support helps cover initial costs, closing cost assistance is there to support first-time homebuyers at the end of the transaction process. These are offered at both the federal, state and local levels through grants, loans, and lender credits.

Tax Deductions

Although not as significant as a government-backed loan, tax deductions offer homebuyers additional financial breaks for specific items related to homeownership costs and more. Some examples are mortgage interest deductions, home equity loan interest deductions, property tax deductions, necessary home improvement deductions, and Private Mortgage Insurance deductions.

Federal First-time Homebuyer Programs

Federal Housing Administration Loans

The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), offers low down payments for loans, can help lower closing costs, and improve borrowers’ chances for qualifying for loans. FHA loans are available in many states and are offered through specific lenders.  For prospective home buyers with lower credit scores, an FHA loan might be their only option.

Fannie Mae Programs

There are a variety of programs offered through Fannie Mae that help those who may qualify for a mortgage but are struggling to save the money for a large down payment. As opposed to a 20 percent down payment, this program offers support to reduce the percentage to as low as 3  percent down, which increases accessibility dramatically for many first-time homebuyers.

These terms are also offered as part of the Conventional 97 mortgage, Home Possible Mortgage, and HomeOne mortgage which have similar eligibility requirements. Another option is the HomePath Ready Buyer Program which requires initial education but helps with closing costs upfront (up to 3 percent of the home’s price).

United States Department of Agriculture Housing Programs

Affordable housing and financial support are offered by the USDA for families who are living in rural America. Eligibility for fixed-rate loans, loan guarantees, and other assistance is based on income levels and varies based on the local income averages for a specific area of the country. The USDA has a map on its website.

U.S. Department of Veterans Affairs

Another government-backed loan offering, VA loans, as they are commonly referred, are loans that lenders offer with increased flexibility and eased eligibility. These loans are exclusive to veterans and active-duty military members. At times, no down payment is required, and improved terms may be applied to the loan. Additionally, Native American Direct Loans (NADL) are offered to veterans and Native Americans in their purchase of a home.

Energy Efficient Mortgages

An EEM is a government-supported loan for energy improvements to a home and can be offered in tandem with a traditional mortgage through HUD. These mortgages are offered because the cost savings from energy-efficient homes can offset the initial difference in a larger loan.

Good Neighbor Next Door Program

The Good Neighbor Next Door program is unique to law enforcement officers, teachers, and emergency medical technicians. The program operates under the idea that these professionals can positively impact a community through homeownership. The program offers a discounted price for a home in a specific neighborhood of a given city or town. These areas are considered revitalization zones and therefore aren’t as flexible as other support options, however the savings are significant.

First-time Homebuyer Programs by State

Even more programs are offered at a local level to help homebuyers achieve their homeownership dreams, and sometimes not only for first-time buyers. Eligibility requirements vary but are often based on income levels, financial history, credit scores, and occupation. The federal Department of Housing and Urban Development (HUD) has a comprehensive list of these programs, which we have detailed below with links to the state program websites.

For every state listed below, there are also NAEBA members present in the state. These exclusive buyer’s agents know how to navigate the local programs and get you the support you need because they’ve worked with other first-time homebuyers.  The goal is for prospective homebuyers to utilize any and all programs to make buying a home more affordable.

Other options provided at a local level include Habitat for Humanity. This global nonprofit housing organization is found in all 50 states and approximately 70 countries worldwide. The program helps rebuild communities, collects donations for household items, and builds homes for very low-income families.

First-time Homebuyer Programs In Alabama (AL)

First-time Homebuyer Programs In Arizona (AZ)

First-time Homebuyer Programs In California (CA)

  • California Housing Finance Agency (CalHFA)
    • Government loans, conventional loans, and down payment assistance offered by the California Department of Housing and Community Development.
  • California Veteran (CalVet)
    • Home loans and other financial assistance are offered for California veterans.

First-time Homebuyer Programs In Colorado (CO)

First-time Homebuyer Programs In Connecticut (CT)

First-time Homebuyer Programs In Florida (FL)

  • Florida Housing Finance Corporation (FHFC)
    • Florida First Mortgage program offers 30-year fixed-rate mortgage loans
    • The Florida Assist (FL Assist) and the Florida Homeownership Loan Program (FL HLP) offer down payment assistance for first and second mortgages
    • Salute Our Soldiers Military Loan Program offers additional support for veterans and active-duty military personnel

First-time Homebuyer Programs In Georgia (GA)

  • Georgia Department of Community Affairs (DCA)
    • Loans and down payment assistance are offered as well as additional support for disabled individuals or those living with disabled persons.
    • Programs range from State Home Mortgages, Georgia Dream, HomeSafe Georgia, and more.

First-time Homebuyer Programs In Illinois (IL)

First-time Homebuyer Programs In Indiana (IN)

First-time Homebuyer Programs In Maryland (MD)

First-time Homebuyer Programs In Massachusetts (MA)

  • MassHousing
    • MassHousing offers a MassHousing Mortgage loan offered with down payment assistance programs as well.
    • Operation Welcome Home offers loans for active military members and veterans.
  • Massachusetts Housing Partnership (MHP)
    • ONE Mortgage program offers low-interest mortgage loans for first-time homebuyers and below-market interest rates. Income restrictions based on household size apply.

First-time Homebuyer Programs In Michigan (MI)

First-time Homebuyer Programs In Minnesota (MN)

  • Minnesota Housing
    • The Start Up Program offers loans, down payment assistance, and closing cost loans to first-time and repeat homebuyers.

First-time Homebuyer Programs In Missouri (MO)

First-time Homebuyer Programs In Nevada (NV)

  • Nevada Housing Division (NHD)
    • The Home Is Possible program offers homebuyers up to 5 percent of a home’s loan value through a one-time fee. The money can be used for a down payment or closing costs. Specific versions of the program are also offered for teachers and veterans.

First-time Homebuyer Programs In New Hampshire (NH)

  • New Hampshire Housing
    • Home Flex Plus and Home Preferred programs offer loans in tandem with tax credits and Mortgage Credit Certificates.

First-time Homebuyer Programs In New Jersey (NJ)

  • New Jersey Housing and Mortgage Finance Agency (NJHMFA)
    • The NJHMFA offers the HFA Advantage Program, the Down Payment Assistance Program, a First-time Homebuyer Mortgage Program, the Homeward Bound Program, and more for loans and down payment assistance.

First-time Homebuyer Programs In New York (NY)

First-time Homebuyer Programs In North Carolina (NC)

First-time Homebuyer Programs In Ohio (OH)

  • Ohio Housing Finance Agency (OHFA)
    • The Ohio Your Choice! Down Payment Assistance program offers down payment support in tandem with guidance on obtaining a 30-year mortgage loan.

First-time Homebuyer Programs In Oregon (OR)

First-time Homebuyer Programs In Pennsylvania (PA)

First-time Homebuyer Programs In South Carolina (SC)

  • South Carolina Housing
    • The Palmetto Home Advantage mortgage offers conventional, FHA, VA, and USDA loan options as well as down payment assistance at different levels.

First-time Homebuyer Programs In Tennessee (TN)

  • Tennessee Housing Development Agency (THDA)
    • The Great Choice Home Loan programs offer a variety of support, including varied loan options, down payment assistance, and closing cost support.

First-time Homebuyer Programs In Texas (TX)

First-time Homebuyer Programs In Utah (UT)

  • Utah Housing Corporation
    • The FirstHome Program offers a variety of options are available that include down payment assistance, mortgage loans, and grants.

First-time Homebuyer Programs In Virginia (VA)

First-time Homebuyer Programs In Washington (WA)

First-time Homebuyer Programs In Wisconsin (WI)

Preparing for Homeownership

While these are just a few of the programs offered at the national and state level, many other resources are available to homeowners – new and tenured. Many states provide educational resources, presentations, and some even require educational courses before allowing you to qualify for their programs.

NAEBA has created a first-time homebuyers guide and other excellent resources to help you get started in the journey. It’s a great resource to begin with before seeking an exclusive buyer’s agent to work with. They’re someone who can then answer the many questions you might have about taking the path to homeownership.

Walk into your first home purchase with confidence by doing your research, understanding the resources available to you, comparing program options, and working with an exclusive buyer’s agent – a dedicated real estate buyer agent who doesn’t represent sellers – who is there to support you from the beginning until the end. Pretty soon, you’ll be turning the key in the door of your very own home-sweet-home!

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