5 Assistance Programs for First-Time Homebuyers

Home in 5 Down Payment Assistance Program - Price Mortgage
I have been on a journey to save for our first home. As first-time homebuyers, we started from scratch, learning what it takes to buy a house.

After a recent meeting with our credit union, we felt disheartened, thinking homeownership was out of reach.

However, we discovered a little-known fact: many credit unions and realtors don’t mention the various programs available to assist first-time homebuyers.

Here are five programs that can help first-time homebuyers afford a home:

Neighborhood Stabilization Program (NSP)

The NSP assists first-time homebuyers by providing 30 percent of a home’s purchase price, up to $50,000. To qualify, a family’s income must not exceed 120 percent of the area’s median income.

WISH and IDEA Programs

These programs offer a matching grant that triples your savings up to $15,000 for families earning no more than 80 percent of the area median income. The funds can be used for down payments and closing costs. Search online for local workshops to learn more about these programs, which can often be combined with other down payment assistance initiatives.

FHA Loan

If your income is too high for the above programs but you still need help financing a home, consider an FHA loan. FHA loans are known for their low down payments and closing costs, and less stringent credit requirements. However, be aware of potential downsides such as restrictions on eligible property types and the requirement for permanent private mortgage insurance (PMI) which could add significant costs over the loan’s duration.

State-sponsored Programs

Each state offers specific programs to assist homebuyers. The U.S. Department of Housing and Urban Development lists all state home buying programs. Check their website to see what’s available in your state.

Good Neighbor Next Door Program

This program is available to police officers, firefighters, teachers, and EMTs. It offers 50% off the appraised value of HUD homes, provided you live in the property for three years. You must be a first-time homeowner or not have owned a home in the past year.

This program is an excellent opportunity if you are open to potentially renovating a home.

These programs are just the tip of the iceberg. There are many resources available to help first-time homebuyers; it just takes a little research to uncover them.

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