First Time Homebuyer Programs Offered

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If you are in the market for your first home, then you may not understand how you can finance it. This can be problematic, especially if you do not have a great deal of money saved for the down payment. The good news is that there are a wide variety of financial services available for individuals looking to buy their first house. Keep reading to learn about a few.

USDA

The United States Department of Agriculture (USDA) does offer a home buyer assistance program. The good news is that the program is extended to individuals who are not looking to purchase a farm. In fact, most of the loans offered by the USDA are simply for homes in rural areas. There are some conditions that have to be met. And, while most loans are offered for rural properties, some suburban ones may be available as well.

The USDA homebuyer program offers full loans for the entire price of the home. This means that no down payment is needed. You must have a dependable income though, a credit score above 640 and a decent credit history. 

The USDA loans are guaranteed and secured ones since they are government loans. They are low interest and you can apply for one directly through the USDA. Some of the loans are quick of fast-tracked varieties depending on your circumstances, so make sure to provide all of your important details when filling out your application.

Fannie and Freddie Loans

Fannie and Freddie loans are also government backed ones that provide mortgages for individuals who have small down payments. Typically, you will need about 3% of the down payment amount or a bit more. Unlike other types of government financing, the Fannie and Freddie loans are ones that are secured through local lenders. The loans are held by the government and they are placed into portfolios for individuals who want to buy security stocks. 

The loans are part of a Congress program that started in 1938 and the program helps to stabilize the financial and lending market. So, you can actually help to ensure that other individuals are able to get loans as well by simply paying your own mortgage on time.

Like other types of government subsidized loans, there are some conditions that need to be met. You do not apply for the financing through the government. You should instead ask your local bank or lender if they offer Fannie or Freddie loans. Contact a first time home buying service for more help.


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