With the ferocity of the real estate market, it can be tough for first-time homebuyers to traverse and navigate the market. And given the economic instability brought about by the COVID-19 pandemic, it is not unreasonable for anyone thinking about buying a home to feel some doubts and anxiety.
But there are plenty of first-time homebuyer programs and grants out there available for people looking into buying a home. These programs can help lower down payments and closing costs, pulling the possibility of your dream home a lot closer than you would have otherwise.
In this article, we’re going to go over some of these programs so you can explore your options and figure out what’s best for you and your future.
1. Conventional loans. These involve the traditional 20% down payment and 30-year fixed payment plan. These can come with stringent requirements, like high credit requirements and so on
2.FHA loans. These loans are insured by the Federal Housing Administration and can be helpful to buyers with low credit ratings and not enough funds for a down payment.
3. VA Loans. These loans are for military personnel, veterans, and their families. It allows them to partake in mortgages without having to secure a down payment, although it can have high-interest rates depending on the partnered lender.
4. USDA Loans. These are loans secured from the US Department of Agriculture, which provides 1–% guaranteed mortgages for low-income borrowers in rural parts of America.
5. Native American Direct Loans. This is also a VA-sponsored program aiding in mortgages to Native American veterans hoping to buy, remodel, or build homes on federal trust land.
6. Good Neighbor Next Door Program. This type of financing is sponsored by the US Department of Housing and Urban Development (HUD). It was designed for law enforcement officers, firefighters, emergency medical technicians, and teachers.
7. HomePath ReadyBuyer Program. This program provides 3% in closing cost support to first-time homebuyers who purchase a foreclosed Fannie Mae property after having completed a certified education course.
8. The Fannie Mae or Freddie Mac Loan Programs. This program guarantees conventional mortgage loans with as little as 3% down payments.
9. Energy-Efficient Home Mortgage Program. This is a joint venture between the FHA and the VA, and allows borrowers to include the costs of making energy-efficient upgrades into their primary loan. This is especially helpful to those who don’t have the cash to make these upgrades.
10. FHA Section 203(k) Loan Program. This program is perfect for people who want to make improvements to their home, but lack the cash for major home improvements. It finances the major improvements of its beneficiaries and includes it into their single, primary FHA mortgage.
It is always important to consider whatever you can to save money and achieve your dreams and plans much faster. Buying a home is a big step for any person and their loved ones, and as such, great care must be put into the considerations of financing. Any of these programs could be of great benefit to you as a first-time buyer.
And if you’re looking for information on financing your first home purchase in Los Angeles, send us at Lend LA a message. We’re here to help.