When it comes to obtaining a mortgage, first time buyer loans are available that can make that jump into owning your own home easier to do. A first time home buyer is recognized by the Federal Housing Administration, or FHA, as someone who has not owned a home or been on a mortgage loan for the last three years. If you meet this qualification, you may qualify for better financing options available through the FHA. First time home buyer loans tend to be easier to get and more affordable.
What to Expect
For those who need a first time mortgage, buyer programs can help make that easier to do. FHA loans are the most common form. These are available through most mortgage brokers and lenders, as well as credit unions. They offer several key benefits. First, the buyer does not have to have a perfect credit score (those with a score of above 600 may be considered). In addition, the closing costs are significantly lower than a conventional (traditional) loan.
Another key benefit of this type of loan relates to the down payment. In a conventional loan, lenders can require down payments as large as 20 percent of the home’s sale value. That’s a significant amount, and it can be hard for a home buyer just starting out to secure this. FHA loans only require 3 percent. You will need to maintain private mortgage insurance, though, during the first years of the loan.
Overall, this type of loan is more accessible than many people realize. If you need a mortgage first time buyer programs can help to make that possible without requiring a lot of money out of your pocket or a lot of risk to the lender. Speak to your lender and compare rates on these loans before you buy a home.
Mortgage first time buyer programs are available, go to Guaranteed Rate for options.
