Saving for a down payment is the most difficult aspect of becoming a homeowner for most first-time buyers. In some locations, saving for a 20% down payment might take more than 40 years, and it is the single most difficult obstacle for homebuyers.
How Do First-Time Homebuyer Grants Work?
Homebuyer subsidies are intended to help first-time buyers with some of the expenditures of owning a home. They generally cover a portion of the down payment, closing costs, or even the entire buying price of the home. They do not require repayment as long as you dwell in your home for the specified time period.
Many first-time homebuyer subsidies are funded by the federal government. Instead, these money are sent to local states, counties, and municipalities, which then establish grant programmes for citizens inside their borders.
First-Time Homebuyer Grant Options
Good Neighbor Next Door
The Good Neighbor Next Door Sales Program is developed exclusively for public officials and covers 50% of a home’s list price. 4 Only law enforcement officers, firemen, emergency medical technicians, and teachers in grades pre-K through 12 are eligible to apply, and the programs is limited to specific properties.
HomePath Ready Buyer
It offers up to 3% of the loan amount in closing cost assistance. To participate in this programs, you must first complete the online HomePath Ready Buyer Course.
National Homebuyers Fund
The National Homebuyers Fund (NHF) is a grant that can cover up to 5% of your total loan amount in down payment or closing fees. It is available in all 50 states and does not have to be repaid, though it is occasionally offered as a 0% interest rate second mortgage. It can be used to purchase or refinance a principal residence.
Also Read: Should You Buy a Fixer-Upper or Move-In Ready Home?
Eligibility and Requirements
To be eligible for any of these first-time homebuyer grants, you must first qualify for a mortgage loan. To determine how much home you can afford. Then, before applying for homebuyer grants and assistance, get prequalified with a mortgage provider to guarantee you can satisfy this criteria.
If you need assistance in minimizing the price of your first home purchase, you have many possibilities. In fact, homebuyers who take advantage of these programs save more than $17,000 over the course of their loan. Check with your state housing agency or a local housing counsellor to see if you qualify for these savings.
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