In today’s day and age, first-time homebuyers can have it rough when it comes to navigating through the world of mortgage, real estate issues, and of course, home buying. With more than 40 percent of first-time homebuyers carrying student loan debt, and the average first-time homebuyer age rising to an all-time high of 32 years old, the real estate market can be a daunting place. Thankfully, as time has passed, resources across many platforms have provided plenty of ways for first time home buyers to not make the same mistake that others have in the past, as well as loans and programs to help make the process less rough. For today’s blog entry, we’ll be doing just that.
Loans
As we explained in our last blog, FHA Loans are just one of many loaning options one can take when it comes to buying a new home. For those new to learning about FHA loans and didn’t have the time to read our previous blog entry on the subject, FHA Loans are loans insured by the Federal Housing Administration, making it good for those with low credit scores and little money saved for a down payment. However, there are a number of other loans out there that one can enroll in which we’ll be going over in this blog entry.
VA Loans
Many U.S. military members (active duty and veterans) are eligible for loans backed by the U.S. Department of Veterans Affairs, the VA for short. Veterans and military personnel get no down payments and include no PMI or minimum credit score. If you struggle to make payments on the mortgage, the VA can negotiate with the lender on your behalf to take some stress from the equation.
USDA Loan Program
Made for borrowers with lower or moderate incomes, the USDA Loan Program is perfect for those purchasing a home in any USDA-eligible department. The U.S. Department of Agriculture, or USDA, guarantees loans for some rural homes and you can get 100 percent financing. This doesn’t mean you have to buy a farm or shack up with livestock, but you do have to buy a home in a USDA-eligible area.
USDA loans also have income limits based on where you live, meaning they’re geared toward folks who earn lower to moderate incomes. Typically, you need a credit score of 640 or higher to qualify for a streamlined USDA loan. If your score falls short, you’ll have to provide extra documentation on your payment history to get a stamp of approval.
Good Neighbor Next Door
The Good Neighbor Next Door Program is made for teachers, lawn enforcement, fire fighters, and emergency medical technicians. Sponsored by the U.S. Department of Housing and Urban Development (HUD for short), this program allows those qualified to receive a discount of 50 percent on a home’s listed price in regions known as “revitalization areas.” Using the program’s website, you can search for properties available in your state. You must commit to living in the home for at least 36 months.
These are just some of many loan programs out there that many first-time home buyers can apply for given the right circumstances and qualifications. There are plenty other types of loans we probably missed but rest assured that we’ll be going over them soon, alongside other topics such as some mistakes home buyers shouldn’t make. From all of us at Mortgages Done Right Inc., thank you for reading and have a lovely day.