If you are interested in saving money on the purchase of your home, listen up. Housing grants can help you lower your down payment, saving you hundreds – even thousands – of dollars upfront. Traditional home loans typically require between 10 and 20 percent of the cost of the home upfront. If you are financing a home that costs $300,000, you would need to pay between $30,000 and $60,000 as a down payment.
Down payment assistance programs help millions of Americans afford their homes. These grants may even help cut your closing costs. Continue reading to find out how you can qualify for these down payment grants.
Most first-time homebuyer grants require you to finance the cost of the home with a certain type of loan. These programs typically accept nationally recognized home loans, such as:
- FHA loans (Federal Housing Authority)
- USDA loans (U.S. Department of Agriculture)
- VA loans (Department of Veterans Affairs)
- Conventional loans (mortgages backed by Fannie Mae and Freddie Mac)
The requirements for housing grants vary depending on the type of grant, the source of the grant and how the grant will be used. Programs determine these criteria to make sure that the grant money is being used in the best way possible.
Although first time home buyer grants and other down payment programs can have different qualifications, most share the following requirements:
- The buyer must be considered “low income” or have an income that falls below the designated limit.
- The buyer must work with an approved mortgage lender.
- The buyer must plan to live in the home full-time.
- The home may need to be located within a certain area.
Additionally, first homeowners grants are only meant to be used by those who have never owned their own home. However, some programs may define “first-time homebuyers” a bit differently. For example, you may qualify as a first-time buyer if you previously owned a mobile home.
Other first-time home buyer grants may have a timeline when determining who qualifies. For example, if you owned a home several years ago and have been renting in between, you may be considered a first-time buyer for some programs.
Since housing grants are available at the federal, state and local levels, grant availability varies. Some programs may not be available nationwide. Similarly, some programs may only offer one type of grant while others may provide a variety of grants.
By Admin –