Top 8 Grants, Programs and Freebies for First Time Home Buyers
A Harvard Business School study found that 78% of baby boomers and millennials want to buy a home. the catch? Most “think” they can’t afford it.
In many cases this may be true. But the research also found that many can. Many have been found to have the income, credit score, and enough time on the job to qualify for the many first-time homebuyer programs and subsidies that I will mention in this article.
Note: Google all phrases in bold for more details.
1. Federal Home Administration (FHA) loan.
If you have a credit score of at least 580, you can qualify for a mortgage for as little as 3.5 percent of the home’s price.
FHA loans have helped more first-time homeowners than any other type of loan.
2. US Department of Housing and Urban Development (HUD).
HUD offers many first-time home owner grants and low-interest loans, depending on the state, city or area in which you live.
Note: For those who currently live in public or government housing, you may be eligible to purchase the home, condo, or apartment you currently live in through the HUD Public Housing Homeownership Program
3. V. A (Veterans Administration) Loans.
If you are active duty or a veteran, you can get a no down payment loan with a low interest rate. A VA loan is the cheapest mortgage on the market because you are not required to pay for mortgage insurance.
4. The Good Neighbor Program.
This first-time homebuyer program offers a home up to 50% off retail price. To qualify, you must be a teacher, police officer, firefighter or EMT. All that is required is a down payment of $100.
You must commit to living in the home for at least 36 months.
5. Energy efficient (or green) mortgage.
The Energy Efficient Mortgage was created to help first-time homeowners add energy-efficient improvements to their home. These loans are insured through the VA and FHA programs.
This mortgage allows you to build an energy efficient home without having to make a larger down payment.
6. HomeReady HomePath Mortgage.
- Another popular program for first-time home buyers. To get quality, you need to take a short buyer training course. Once you complete the course, you’ll receive 3% toward your mortgage closing costs. The down payment, 3%, is lower than the lowest FHA loan.
7. HUD Dollar Home Program.
After 180 days on the market, certain unsold HUD properties are offered exclusively to local government entities for $1 per 10 days. Local county cities then offer these properties to residents to revitalize communities or neighborhoods.
8. USDA Home Loan Program.
This program focuses on homes in predominantly rural areas, if you like or can tolerate country living, this loan may be for you. This program guarantees 90% of the loan, which means that no down payment may be required and the loan is fixed. Sweetie!
These are the top 7 programs available to first-time home buyers. As always, like ocean waves, government programs come and go. But as of this writing, these programs are helping thousands of first-time homebuyers who feel they can’t afford a home make their dream come true. Check them out… you could be next!
First time home buyer love and other freebies
1. No penalties.
A first time home buyer can take up to 10,000 dollars Roth IRA contributions to pay for the home without penalties. Check with your tax advisor for the latest rules.
2. Real estate agent. This person can be your biggest source of information when looking for your first home. They know your local housing market, the pros and cons of specific homes. They can help you choose the right home to suit your personal and financial needs and much more. The best part? They are free if you are a buyer.
3. Prior approvals. Another amazing free service is pre-approvals. They help you save time and energy. how? They let you know what price range you can afford, helping you and your agent figure out which houses to look at.
4. First Time Home Buyers Tax Credit (HBTC): The HBTC is a non-refundable tax credit for first-time home buyers and is worth $750. The first-time home buyer tax credit must be claimed on an income tax form no later than one year after the purchase of the home.
5. The Home Buyers RRSP Plan (HBP)
This program is designed to allow you to withdraw funds from your Registered Retirement Savings Plan (RRSP) before retirement for the purpose of purchasing a first home. The advantage of HBP is that the withdrawal is completely TAX FREE.
The Home Buyers RRSP Plan allows you to withdraw up to a maximum of $25,000. Be sure to consult your tax advisor for more details.
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