The definition of a First time homebuyer is someone who has never owned a home before or has not owned one for at least 3 years. If you inherited a home and do not live in it, then you qualify as a first time homebuyer. If you live in the home you inherited, you do not qualify. If your spouse owns a home, you do not qualify separately. If you are married and you are not on the loan, you still do not qualify as a first time homebuyer. The state will qualify you for your status of the tax records and your tax return. You cannot fake your way! Don’t try…you’ll get caught and it’s embarrassing.
First time homebuyers programs are designed to help you get into your first home. The programs assist you by:
- Allowing you to have a below market fixed interest rate
- Giving you a gift to help with your down payment
- Lets you qualify with a credit score of 600 or above
The different types of programs are:
- MHDC – A state supported program that gives the buyer a 3% gift to help the buyer with their down payment. It also guarantees a fixed-rate mortgage that is usually below market rate. There are income and sale price limits for the buyer but they are fairly liberal as long as you make under $100k a year. This program is for owner-occupied homes only.
- FNMA – A state program that lets you buy a home with as little as $500 of your own money. There are income and location limits, but it works almost anywhere in the state of Missouri, except St. Louis County. No down payment is required and neither is mortgage insurance, making your house payment lower than normal.
- NECAC – A county program that allows you to buy homes in St. Charles City, St. Charles County, City of O’Fallon, City of Wentzville and part of Lake St. Louis. The amount available per household range all the way up to $10,000 for down payment and closing costs. There are income and sale price limits. This is a deferred loan. There is no interest on the loan and it is to be repaid when the home is sold. This program is for owner-occupied homes only.
- NECAC- A St. Louis County and City of Florissant program that gives a buyer $3,000 in assistance for a down payment. This is a forgivable loan as long as the buyer stays in the house for 5 years. An 8-hour homeownership class is required.
For more information on any of these loans, email me via [email protected].
These programs are full of opportunity, but they cannot be combined. When executed correctly, each of these programs can get you into a house for less than $1,000, and in some cases for less than $500. You can have little cash and take advantage of a program that lets you buy a home for little or no down payment.
If your REALTOR® doesn’t know about these programs, you’ll be in the dark as well. Look into getting another agent. You cannot afford to be with an amateur when it comes to securing these kinds of funds.
There are other programs that fit other needs, but the thing you need to remember is to do your homework. Find out what programs you are eligible for, which one benefits you the most and then get started. The contract you write on a property has to say you are participating in one of these programs. This information can’t be added in as an afterthought. If you need help sorting out what you’re eligible for, email me at [email protected].