Financing Programs for First Time Home Buyers
With some of the lowest mortgage rates in decades, now is the perfect time to transition into home ownership. However, for many first time home buyers, the biggest hurdle of purchasing a home is saving up enough money to put a substantial-enough down payment in at closing. If you find yourself in the same situation, you're in luck! There are a variety of different programs that you may qualify for that can help make purchasing a home less financially stressful.
Michigan First-Tiem Home Buyer Programs
FHA Program /Loans
Insured by the Federal Housing Administration, this is one of the lowest interest loans available for qualified homebuyers. This program gives those who may not have sufficient saved funds or have traditionally struggled to secure home financing the opportunity to become a homeowner.
Key Benefits:
- Easier credit qualifying (620 minimum)
- Low closing costs
- Gifts may be given towards home down payment
- Less strict debt ratios
Everything you need to know about finding and purchasing your first home
Get your copy of the First-Time Homebuyer’s Guide
USDA 100% Financing Program
Structured just like a conventional loan, however, unlike conventional loans it requires no down payment allowing buyers to finance a home for 100 percent of the purchase price. USDA does require private mortgage insurance which is .4% monthly.
Key Benefits:
- Zero down payment
- Lower credit qualifying (640 minimum)
- Property must be located in targeted area (Contact us to check eligibility)
- Income restrictions apply
Good Neighbor Next Door
This program is designed to encourage renewal of revitalization areas by providing an opportunity for law enforcement officers, EMTs, firefighters, and teachers to purchase homes in these communities. In turn, HUD (U.S. Department of Housing and Urban Development) offers a 50% discount off the list price of eligible homes.
Key Benefits:
- Get home at 50% discount on home in target areas
- Must be law enforcement, police officer, teacher, firefighter, or emergency medical technician to be eligible for this program
- Low Down Payment Option available in HUD Participating Communities
VA Loan
Guaranteed by the U.S. Department of Veterans Affairs, this loan is designed to offer long-term financing to eligible American veterans or their surviving spouses.
Key Benefits:
- Zero down payment
- Reservists are eligible with 6 years service
- Lower credit score qualifying (620 minimum)
- No maximum loan limit
- No private mortgage insurance
USDA Rural Development Loan
Properties in an eligible USDA Rural Development area (along with income restrictions of purchasers) qualify for this loan allowing buyers to purchase the home with little to no money down.
Key Benefits:
- Zero down payment
- Low credit score qualifying (620 minimum)
- Low private mortgage insurance
You can utilize tools such as the mortgage calculator to help you determine how much house you can afford, while factoring in items like income, expenses and loan interest.
For everything from choosing the best realtor to first time home buyer mistakes to avoid, download the First Time Home Buyer Guide.
