First Time Home Buyer Guide: Top 3 Resources for Financial Assistance

 

If you’ve never owned a home, the prospect of buying your first is likely to be exciting and possibly a bit scary. A fear of the unknown is what turns many people away from researching assistance that could make their first home purchase possible. If buying a home feels out of reach, take some time to learn about the available options that could put homeownership within your grasp. Read on to see our first time home buyer’s guide and learn some tricks to make purchasing a home easier.

Start Up Loan

 

This option is available through select lenders, and offers first time homebuyers a more affordable way to purchase a home. If you’re looking for a lower interest rate or down payment, this program provides options that make sense for your situation. Additionally, the program has the advantage of low closing costs. There are some limitations to be aware of before choosing this type of loan.

• There is an annual income limit of $103,900
• Minimum credit score is 640
• You must be a first time homebuyer

For more information on start up loans, visit the MN Housing website.

Mortgage Credit Certificate Program

 

This is a statewide tax credit program that certain lenders offer to first time homebuyers. The program allows home loan borrowers to claim a percentage of their mortgage interest as federal income tax credit. Some things to keep in mind with the mortgage credit certificate program include:

• The maximum amount a person may claim is $2000
• There is an income limit of $103,900
• Acquisition costs vary
  • $306,000 for the 11-county metro area
  • $253,800 for the rest of the state
• You must be a first time homebuyer to get this tax credit

This program may not provide funds directly towards the purchase of a home, but the tax savings are always helpful for someone paying off their first mortgage. MN Housing provides resources to help buyers take advantage of this program.

 

Down Payment and Closing Cost Assistance Loans

 

One of the barriers new homeowners face is the prospect of paying the down payment and closing costs. The state of Minnesota provides loan assistance of up to $12,000 for these costs. If you’re hoping to buy your first home, these funds can be the difference between a successful purchase and a failed attempt.

 

In order to qualify for these funds, new homebuyers must first apply for a Minnesota Housing first mortgage loan. After going through this process, they may choose either a monthly payment option that is paid over 10-years or a deferred payment loan that is paid when the home is sold. The monthly payment option has an interest rate equal to the interest rate of the first mortgage rate, while the deferred payment route has 0% interest. You can find more information about these loans here.

 

 

Simplify Your First Home Purchase

 

If you ever have any questions about first time homeowner grants, our experts can help. The first step is finding one of our offices near you. When you work with a real estate agent who understands your concerns as a first time homebuyer, it makes the prospect of buying a home much less intimidating. Our agents have the experience to help turn your dream into a reality. Contact us today to discover a better way to buy.