BEST LOANS FOR FIRST TIME HOME BUYERSINTRODUCTIONBuying a home for the first time is not a small feat, especially when securing a loan for the purchase is the subject in focus.A first time home buyer will ordinarily be overwhelmed by the procedures, stages and requirements incidental to acquiring a loan but it's not all gloom and doom.First-time homebuyers enjoy some special benefits as far as their first home purchase financing is concerned. There are several first time home buyer loans and assistance programs, designed to help and encourage new entrants into the real estate scene.WHO IS A FIRST TIME HOME BUYER?Meanwhile, the United States Government, through the agency of the Department for Housing and Urban Development, classifies you as a first time home buyer if you've not had any homeownership in the past 3 years. If you qualify as a first time home buyer, going by the above definition, you can access special mortgage programs with low down payments, flexible guidelines, tax breaks and some other benefits.As with other types of conventional loans, the eligibility of first time home buyers for these government housing grants is largely predicated on a borrower's credit score and overall credit rating. The relevant standards are just considerably relaxed under these special programs not totally abrogated.QUALIFYING FOR FEDERAL ASSISTANCE To be qualified for most of the available Federally Funded Assistance Programs, a first time home buyer has to have at least 640 points or more. Still, under a conventional mortgage arrangement, a first time home buyer will likely need at least 680 points or more.First time home buyers, with a combined household income of $120,000, are comfortable with paying a minimum of 5% of the property's purchase price as a down payment for these special loans.Up until this moment, the article has dealt with blanket generalizations. Let's now attempt a robust discussion of one of the most sensible loan options for first time home buyers 1.FHA LOANThis is a government-backed loan created to cater to the needs of buyers with low Credit Scores.This loan is insured by the Federal Housing Administration, and it demands smaller down payments and a less stringent credit score requirement (if one compares it with conventional mortgage loans) With the aid of FHA Loans, don't be surprised that first time home buyers with a credit score of 580 will be able to a home with a down payment as low as 3.5% of the home's purchase priceFor pre-application, first time home buyers with 500 to 579 Credit Score will have to shell out at least, 10% of the property's purchase price if they're to qualify for an FHA LoanThe potential downside to an FHA Loan is that one must compulsorily pay for private mortgage insurance and this condition will ordinarily increase borrowing costs.This is because private mortgage insurance features a high upfront premium. When you remember you're paying all that money to protect the lender, not yourself, it feels a little anticlimactic.There are other sensible loan options available for a first time home buyer. This list includes but isn't limited to USDA Loans, designed for homebuyers in rural areas, VA Loans, designed for active service members and veterans, Good Neighbor Next Door Program, designed for firefighters, law enforcement officers, emergency medical technicians, to mention a few.FINAL REMARKSUltimately, first time home buyers will find special mortgage loans designed with their needs in mind both in the private and public sector. The trick is understanding how to hunt for these programs.

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