Having a home of your own is considered one of the major milestones in an individual’s life. The emotions that one’s go through while they enter their own house is priceless. However, a lot of thought processes, planning, and budgeting are required while purchasing a house.
Starting from arranging for a down payment to applying for a loan, one needs to look for all the available options, compare them, and select one that suits their requirements.
In this article, we have covered some of the best first-time homebuyer programs that assist you in making down payment and closing costs.
Types of assistance?
Nowadays, numerous programs are available that can provide you assistance in down payment, as well as closing costs. Some of these programs are government-sponsored, and some are charitable. In addition to this, federal and local tax credits help you by cutting your tax.
online pharmacy purchase vibramycin online best drugstore for you
It is not finished yet, to provide help to first time home buyers, numerous education programs are also there that can help you at every step of the home-buying process.
Down Payment Aid:
The first amount that you need to give to book the property is known as the down payment. People start saving money for down payment years before the time of purchase. One of the safest investment options is debt instruments.
Many people have this misconception that they need to get a mortgage. They need to pay at least 20% of the property value as a down payment. Well, you might be surprised to know that many mortgage companies are ready to give a mortgage to first-time homebuyers for, as little as 3% of down payment.
Down Payment Assistance loan
If you do not have enough savings to make the down payment, no need to give up. You might be able to get a DPA loan. Some of the loan options that you can consider are:
Second mortgages: The debtor needs to clear this loan at the same time as his/her primary mortgage.
Deferred payment loans: The borrower needs to pay off this loan in full when the borrower either move, clear his primary mortgage, refinance, or sell the house.
Forgiven loans: As the name suggests, the loan, in this case, can be forgiven for a set period. However, the borrower has to repay the loan at the time of refinancing, move, sell-off, or pay-off the primary mortgage.
Down Payment Assistance Grants
Well, to help the first-time home buyers, the government also provides DPA grants. The best part of these grants is that they don’t need to be repaid. The eligibility of these grants and loans may vary. For further information, you can check with your local or state government.
Government-Backed Loans
In case you get a government-backed loan, then as a first-time buyer, you would be eligible to purchase a house without making any down payment.
Tax Credits
Another way by which you can save money on taxes is via deductions. These deductions would result in lowering your taxable income. Lower the taxable income lower will be the tax. Some of the costs that you can deduct from your taxable income are Mortgage Insurance Cost and Private Mortgage Insurance. For detailed information on the credits and deductions, you need to contact your local or state government.
Home Buyer Education
One of the major issues faced by the first-time homebuyer is how to start the process. Well, numerous educational programs are available online. You can use their assistance at every step of the buying process. They cover almost everything about the buying process like loan options, the loan application process, documents required, etc.
How to get the Assistance?
Some of the charitable, government, and employment assistance programs are discussed below. They can help get a solution for how to manage money for purchasing your first house.
online pharmacy purchase fluoxetine online best drugstore for you
Government Programs
In order to help first-time buyers, local, federal, and state governments offer several assistance programs. The first and the foremost eligibility criterion for a federal program is that the applicant has to be a legal resident or citizen of the United States. Some of the most famous federal programs are:
Government-Backed Loans
As discussed earlier, these loans allow the buyer to buy a house by paying a low down payment. With these loans, an individual with poor credit can also buy a house. In this kind of loan, the government act as an insurer.
online pharmacy purchase xenical online best drugstore for you
This reduces the risk factor, and hence, the lender can offer you a mortgage at a lower interest rate.
Options available in government-backed loans are:
FHA Loans
USDA Loans
VA Loans
Each of these loans has different eligibility criteria.
Just like USDA loan, you need to check the usda eligible areas map to see if your location is qualified for the loan
Good Neighbor Next Door
The HUD department sponsors this program. The eligible applicant gets 50% off on selected properties. These properties are highly affordable. Individuals who are a teacher, law enforcement officer, firefighter, or an emergency medical technician by profession are eligible for this program. The list of properties is available on the official site of the HUD program.
Charitable or Non-profit organizations
If your income falls in the category of low to moderate, then you can apply for charitable assistance. These organizations can provide you educational, as well as financial assistance in the purchasing process.
Employer Assistance
Nowadays, even employers are providing financial assistance to their employees for purchasing a house. You might get a loan or a grant for the company to cover the down payment or the closing cost.
The Conclusion
With so much assistance available, the purchase process of the house has become a lot easier. You need to check the eligibility criterion and, based on that, apply for the grant or loan that suits your financial needs.