Source: Next Advisor —
Buying a house for the first time can put a strain on your budget. Fortunately, first-time homebuyer programs can ease the pressure by offering some form of financial assistance.
Considering how much home prices have increased in the past few years, it seems homebuyers could use all the help they can get to be able to afford a home. The median existing home sales price was $379,100 in October, compared to $355,700 in October 2021 and $271,900 for the year 2019, according to data from the National Association of Realtors.
The type of help offered by first-time homebuyer programs can vary, but often includes things like tax incentives, grants, interest-free loans, down payment and closing cost assistance, reduced down payment requirements, and more. The types of programs available vary depending on where you are located and whether the lender offers or works with the third-party organizations providing these programs.
Finding a good lender, let alone one that works specifically with first-time homebuyer programs, can be challenging. That’s why we’ve done the research for you with our picks for the best mortgage lenders for first-time homebuyers.
Which Mortgage Type Is Best for First-Time Homebuyers?
Different types of loans have different eligibility requirements, features and characteristics. The best loan for you will depend on what you can qualify for, what you need, and what you want. Some types of loans you could consider include:
- Conventional loans
- Jumbo loans
- FHA loans
- VA loans
- Fixed-rate loans
- Adjustable-rate loans
Conventional loans can allow for a down payment as low as 3%. They generally have competitive rates, but do require good credit and income. If you’re not able to meet the credit requirements, you could consider an FHA loan. FHA loans require a 3.5% down payment, but offer more flexibility on credit requirements.
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