How do I know if I qualify as a first time home buyer?
The qualifications for first-time home buyers are broader than perceived. According to the Federal Housing Administration (FHA), there are many factors considered to qualify as a first time home buyer. The following criteria are qualifications to be considered a first time home buyer:
- If you never owned a home
- If you were married and owned a home with your spouse and are now separated or divorced
- If you have only owned a home not permanently attached to a foundation such as a mobile home
- Anyone who has not owned a principal residence in 3 or more years
- If a person doesn’t qualify as a first time home buyer on their own, but their spouse does, both spouses qualify as first time home buyers.
- If your former home did not meet state, local, or model building codes and is not in compliance for less than the cost of building.
First Time Homebuyer Advantages
There are several advantages first time home buyers receive. Every state in the U.S. has different local resources for the first time homebuyers. State housing authorities have special financial assistance programs. These programs target first time buyers with low incomes, struggling credit scores, low down payments, single parents, and/or homebuyers with disabilities. However, qualifications for these programs differ from state to state. Taking advantage of financial assistance programs is a great opportunity to receive assistance to afford down payments, closing costs, or any other expenses related to the home buying process.
Programs for First Time Homebuyers
You may also qualify as a First-Time Home Buyer through the U.S Department of Housing and Urban Development (HUD). They provide home qualifications and counseling services. HUD has counseling agencies in every state, examining if you are considered as a First-Time Home. These agencies also recommend a suitable plan for you.
The Federal Housing Administration (FHA) is the largest program for first time homebuyers, granting 3.5% payment required by FHA for low-cost loans. Other loans with specific requirements include USDA loans, VA loans, and Down Payment Assistance Programs. Some private mortgage lenders also offer special rates and programs for first-time buyers. Furthermore, the Internal Revenue Service has special policies for first time homebuyers to withdraw from their IRA (Individual Retirement Accounts) to use as a down payment.