What’s stopping you from joining the ranks of homeowners? If the answer is ‘cash for a downpayment and closing costs,’ you may be closer to homeownership than you think.
While a downpayment and closing costs can amount to tens of thousands of dollars, there are programs designed to help first-time homebuyers buy a house with little-to-no money down.
Take Stefany. She enlisted the help of HomeFree-USA when she wanted to become a homeowner. HomeFree-USA helped her identify $39,000 in downpayment assistance and closing cost help. All Stefany needed to come up with was $3,500 of her own money when she bought her house.
If you want to follow in Stefany’s footsteps, here’s what you should know.
Who offers financial assistance to first-time homebuyers?
There are many programs available for first-time homebuyers. Some are offered by banks and other financial institutions. Others are offered by non-profit organizations and government entities. A Homeownership Advisor with HomeFree-USA can help you identify a program you might qualify for.
What do homebuyers typically need to qualify for financial assistance?
Every program is different, but to determine if you qualify, program administrators will typically consider:
- Your credit score
- Whether you are a first-time homebuyer
- Your income
- Whether the home will be your primary residence
What’s the difference between downpayment help and closing cost assistance?
A downpayment is the amount of money a homebuyer is expected to put down on a house in order to qualify for a mortgage loan. For example, a loan may require homebuyers to put down 3 percent. Closing costs refer to other fees paid when you close on a house such as the application fee, escrow fee and origination fee.
In the example above, down-payment assistance would go toward the 3 percent you’re expected to put down on the loan. Closing cost help, on the other hand, would go toward those other fees homebuyers are expected to pay.
How can downpayment and closing cost assistance help me buy a home?
With downpayment and closing cost assistance, you don’t have to come up with as much money to buy a house. That means you might be ready to buy a home six months or a year sooner than if you had to save up for the entire downpayment and closing costs yourself.
Even if you have the money to make a downpayment and pay for closing costs, think about what other things you can use that money for. For example, you can save it for emergencies, invest it or buy new furniture for your home.
How do I find money for a downpayment and closing costs?
Buying a house can be an overwhelming process. Finding programs that offer free money for downpayment and closing cost assistance can be time-consuming, especially if you don’t know where to look.
HomeFree-USA will do that work for you. In fact, we already know about many programs that homebuyers may qualify for. If you want to find out how much money you can qualify for, register for the upcoming Buy a Home with Little-to-No Money Down event.