1st Time Home Buyers Programs Vary From State to State

If you’re entering the home buying market for the first time today, you will find many more obstacles to home ownership than there were just a few short years ago. The housing market melt-down has caused lenders to pull in their horns making it much more difficult to get a mortgage or home loan than it has been for years. This is the biggest obstacle most 1st time buyers will encounter.

Yet, there is hope. Many states and even the federal government realize that 1st time home buyers are the driving force in the real estate market. Therefore, they have designed 1st time home buyers programs to bring home ownership within reach of a large number of people. What is a first time home buyer? First time home buyers are not only those that have never owned a home, but those that have not owned a home within the last three years.

Some of these 1st time home buyers programs offer down payment assistance, another big obstacle for many 1st time buyers. In the glory days of the housing boom, $0 down payment loans were plentiful. Today, most lenders want at least a 5% down payment. When you consider that the average price of a home in this country is still around $200,000, that means a 1st time buyer must come up with $10,000 plus all the other related costs of securing a home loan which can amount to another $4,000 or more. Other programs are geared towards specific groups of people like teachers, policemen, firefighters and native Americans.  There is even a program for public housing residents.

All 1st time home buyers programs are designed to help people secure affordable financing. Let’s face it. Unless you can pay cash for a home, you’re going to need to borrow money to pay for a home. If you’re short on cash but have good credit and steady employment, you’re halfway there. Even if you have less than stellar credit (but not terrible credit) and money for a small down payment — either from your own savings or a gift from a relative — you may be able to secure an FHA loan. If you’re a veteran, you may be able to use your veteran’s benefit to secure a VA loan – a 100% loan exclusively for those that have seen active military duty.

The real estate market today is probably the best market in many, many years in which to purchase a home. With historically low interest rates, home prices that haven’t been seen in nearly 10 years in some markets, and 1st time home buyer programs that make it easier to purchase a home, now is probably the best time in over 20 years to buy the home you’ve been dreaming of.