First time home buyer grants to help with down payments and other necessary closing costs

Buying a home for the first time is a big deal for many Americans, as they need to have enough cash to make a down payment, and cover the basics. A first-time home buyer is anyone who has not owned their primary residence in the last three years. This three-year cut-off period is based on the upcoming purchase property’s closing date. Nevertheless, arranging for cash is a big issue for first time home buyers. However, they can gain access to cash to help them pay for down payment, mortgage, and other closing costs. Grant money helps the local community at large by building stability and generational wealth, and also increases local spending, that benefits small businesses in the area. 

While eligibility requirements for first time home buyer grants may vary, there are some common requirements, like:


  • The applicant should earn 80% or less of Area Median Income (AMI)  
  • Many grant programs stipulate the applicant to chip in some cash    
  • Your spending may be restricted with a certain range of residence  
  • You need to make the home your primary residence to receive the grant  
  • Many programs require you to complete a homebuyer education course prior to receiving funds

Federal Housing Finance Agency (FHFA) discounts


A number of states offer outright first time home buyer grants, and you will never have to repay the money. The grant money could be 3% to 5% of your home’s purchase price. Some states also provide forgivable loans that have no monthly payment, and a 0% annual percentage rate. After a period of 5 to 10 years, the loan is fully forgiven. National Homebuyers Fund (NHF) provides first time homebuyer grants, or three-year forgivable loans to first time buyers. You can receive up to 5% of the loan amount, that can be paired with a conventional FHA, or USDA mortgage. Federal Housing Finance Agency (FHFA) discounts first time home buyer interest rates, so homes are more affordable. Eligible buyers get automatic mortgage rate discounts of up to 1.75 percent off the conventional 30-year fixed-rate mortgage rates. 


Down Payment Assistance (DPA) program 

 

Down Payment Assistance (DPA) program is designed to help you cover the upfront costs of a down payment. The specific assistance program you qualify for can impact on how you use the funds. Program requirements for loans and grants may vary, so it is best to check with your local or state government. Closing Cost Assistance programs will help you with some of the secondary costs of buying a home, which could be 2% to 6% of the loan amount. Some deferred payment loans are also available to homebuyers that you need to repay only when you sell, move, refinance, or pay off your original mortgage loan. Individual Development Account (IDA) provides a savings match for every dollar you contribute, up to a certain amount, which is often $1000 to $5000, depending upon the program.


Other grant options


There is no better time than now to take advantage of first time homebuyer grants as prices have gone down by as much as 75% in many areas, and there is a record number of foreclosed homes available. You can get more information on all first time home buyer grants, and other grant programs like business grants for veterans, childcare grants, training & research grants, and more, for GovernmentGrants.us. For this, you just need to pay a monthly fee of just $29.95, which is refundable in case your grant application is rejected. You can also hire a professional grant writer from GovernmenGrants.us, who will help craft a professional grant application for you. 

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