First-time Homebuyer Programs to Get You Home
Did you know that first-time homebuyers made up 31% of buyers in December 20221? Even in a higher interest rate environment, savvy buyers are looking for strategies and mortgage programs that can help them accomplish their dream of homeownership – even for low-income households.
There are many benefits that come with owning a home, which can have a significant impact on building strong communities and the creation of generational wealth. However, the prospect of being able to save for a down payment can be incredibly daunting for some. Certainty Home Lending is proud to offer programs to help hopeful buyers overcome this hurdle. While the average down payment was 13% in 20222, there are many low- and no-down payment options out there.
FHA Home Loans
Let’s start with the basics. An FHA mortgage is a popular option with first-time homebuyers3. It was created to help potential buyers purchase a home of their own by providing a lower down payment option and flexible underwriting criteria.
Program highlights include:
There are also home financing options for Veterans, or those looking to purchase in certain rural communities3, that offer down payment options as low as 0%. Make sure you speak to a Loan Officer about your goals so they can go over the possibilities.
Down Payment Options as Low As 3%
In addition to FHA mortgages, there are a variety of other programs that were created specifically to help first-time buyers. Freddie Mac and Fannie Mae, two companies that were chartered by Congress to support the US home finance system, rolled out Area Median Income (AMI) Programs that allow 97% loan-to-value (LTV) financing. That means qualified borrowers can put as little as 3% down on a home - less than even an FHA loan!
AMI is a measure of the average household income in a given area. These AMI Programs expand homeownership opportunities for people that are at or below 100% AMI in many areas of the United States, and up to 120% AMI in high-cost areas. Click here to view the Area Median Income for your area.
Previously, popular mortgage options were made available for households up to 80% AMI. This is our way of leveling the playing field for first-time homebuyers, and those from mid-to-low-income communities.
Program highlights include:
Speak to your local Loan Officer to discuss whether you can qualify for the Area Median Income Program for first-time homebuyers.
HomeReady Special Purpose Credit Program
In addition to traditional loan options, there are some programs available in specific areas. Certainty Home Lending is introducing the HomeReady Special Purpose Credit Program (SPCP) to help eliminate the significant hurdle of saving for a down payment in underserved communities. We are proud to be on a very short list of lenders who are able to offer this program.
The SPCP offers up to a $8,000 grant in down payment assistance for first-time homebuyers. Funds can be used to help with your down payment or towards your closing costs. Often, closing costs eat into a perspective buyer's available down payment budget, which can lead to increased monthly mortgage payments.
Program highlights include:
HomeReady SPCP addresses two of the largest hurdles in financing a home - down payment and closing costs. For qualified buyers in the cities listed above, this is a golden opportunity to make your dreams of homeownership a reality.
Wrap Up
Homeownership is more than just a financial investment - it’s an investment in your future. It’s a place to put down roots, a place to raise a family and make memories that will last a lifetime. At Certainty Home Lending, we believe that everyone deserves the opportunity to make home a reality. That’s why we introduce programs to try and balance the scales for those who may think that homeownership is just out of reach.
While the home finance process can seem foreign, especially to those who live in particularly difficult markets, having the right lending team by your side can make all the difference. Start a conversation today with a Loan Officer and finance a home with confidence.
1 https://www.nar.realtor/newsroom/existing-home-sales-receded-1-5-in-december
2 Source: https://cdn.nar.realtor/sites/default/files/documents/2022-home-buyers-and-sellers-generational-trends-03-23-2022.pdf
3 Certainty Home Lending has no affiliation with the US Department of Housing and Urban Development, the US Department of Veterans Affairs, the US Department of Agriculture or any other government agency.
All information provided in this publication is for informational and educational purposes only, and in no way is any of the content contained herein to be construed as financial, investment, or legal advice or instruction. Certainty Home Lending does not guarantee the quality, accuracy, completeness or timelines of the information in this publication. While efforts are made to verify the information provided, the information should not be assumed to be error free. Some information in the publication may have been provided by third parties and has not necessarily been verified by Certainty Home Lending. Certainty Home Lending, its affiliates and subsidiaries do not assume any liability for the information contained herein, be it direct, indirect, consequential, special, or exemplary, or other damages whatsoever and howsoever caused, arising out of or in connection with the use of this publication or in reliance on the information, including any personal or pecuniary loss, whether the action is in contract, tort (including negligence) or other tortious action.
There are many benefits that come with owning a home, which can have a significant impact on building strong communities and the creation of generational wealth. However, the prospect of being able to save for a down payment can be incredibly daunting for some. Certainty Home Lending is proud to offer programs to help hopeful buyers overcome this hurdle. While the average down payment was 13% in 20222, there are many low- and no-down payment options out there.
FHA Home Loans
Let’s start with the basics. An FHA mortgage is a popular option with first-time homebuyers3. It was created to help potential buyers purchase a home of their own by providing a lower down payment option and flexible underwriting criteria.
Program highlights include:
- Down payment option as low as 3.5%.
- Flexible qualifying criteria with less strict credit score requirements compared to conventional home loans.
- Under FHA guidelines, if you have not owned a primary residence for at least three years you may qualify as a first-time homebuyer.
There are also home financing options for Veterans, or those looking to purchase in certain rural communities3, that offer down payment options as low as 0%. Make sure you speak to a Loan Officer about your goals so they can go over the possibilities.
Down Payment Options as Low As 3%
In addition to FHA mortgages, there are a variety of other programs that were created specifically to help first-time buyers. Freddie Mac and Fannie Mae, two companies that were chartered by Congress to support the US home finance system, rolled out Area Median Income (AMI) Programs that allow 97% loan-to-value (LTV) financing. That means qualified borrowers can put as little as 3% down on a home - less than even an FHA loan!
AMI is a measure of the average household income in a given area. These AMI Programs expand homeownership opportunities for people that are at or below 100% AMI in many areas of the United States, and up to 120% AMI in high-cost areas. Click here to view the Area Median Income for your area.
Previously, popular mortgage options were made available for households up to 80% AMI. This is our way of leveling the playing field for first-time homebuyers, and those from mid-to-low-income communities.
Program highlights include:
- Down payment option as low as 3%.
- One of the occupying borrowers must be a first-time homebuyer.
- Available for primary residences.
- Must meet income and qualifying criteria.
- Can offer lower down payment options when compared FHA or Conventional home loans.
Speak to your local Loan Officer to discuss whether you can qualify for the Area Median Income Program for first-time homebuyers.
HomeReady Special Purpose Credit Program
In addition to traditional loan options, there are some programs available in specific areas. Certainty Home Lending is introducing the HomeReady Special Purpose Credit Program (SPCP) to help eliminate the significant hurdle of saving for a down payment in underserved communities. We are proud to be on a very short list of lenders who are able to offer this program.
The SPCP offers up to a $8,000 grant in down payment assistance for first-time homebuyers. Funds can be used to help with your down payment or towards your closing costs. Often, closing costs eat into a perspective buyer's available down payment budget, which can lead to increased monthly mortgage payments.
Program highlights include:
- Grant up to $8,000 ($5,000 base credit and up to $3,000 lender credit).
- One of the occupying borrowers must be a first-time homebuyer.
- No exclusions based on Area Median Income (AMI), broadening who can qualify.
- Available in specific census tracts, including Atlanta, Baltimore, Chicago, Detroit, Memphis and Philadelphia.
HomeReady SPCP addresses two of the largest hurdles in financing a home - down payment and closing costs. For qualified buyers in the cities listed above, this is a golden opportunity to make your dreams of homeownership a reality.
Wrap Up
Homeownership is more than just a financial investment - it’s an investment in your future. It’s a place to put down roots, a place to raise a family and make memories that will last a lifetime. At Certainty Home Lending, we believe that everyone deserves the opportunity to make home a reality. That’s why we introduce programs to try and balance the scales for those who may think that homeownership is just out of reach.
While the home finance process can seem foreign, especially to those who live in particularly difficult markets, having the right lending team by your side can make all the difference. Start a conversation today with a Loan Officer and finance a home with confidence.
1 https://www.nar.realtor/newsroom/existing-home-sales-receded-1-5-in-december
2 Source: https://cdn.nar.realtor/sites/default/files/documents/2022-home-buyers-and-sellers-generational-trends-03-23-2022.pdf
3 Certainty Home Lending has no affiliation with the US Department of Housing and Urban Development, the US Department of Veterans Affairs, the US Department of Agriculture or any other government agency.
All information provided in this publication is for informational and educational purposes only, and in no way is any of the content contained herein to be construed as financial, investment, or legal advice or instruction. Certainty Home Lending does not guarantee the quality, accuracy, completeness or timelines of the information in this publication. While efforts are made to verify the information provided, the information should not be assumed to be error free. Some information in the publication may have been provided by third parties and has not necessarily been verified by Certainty Home Lending. Certainty Home Lending, its affiliates and subsidiaries do not assume any liability for the information contained herein, be it direct, indirect, consequential, special, or exemplary, or other damages whatsoever and howsoever caused, arising out of or in connection with the use of this publication or in reliance on the information, including any personal or pecuniary loss, whether the action is in contract, tort (including negligence) or other tortious action.