Unraveling the Mysteries of First-Time Homebuyer Grants

The common advice we've all heard suggests that responsible homeownership mandates a 20% down payment without exception. This sum, while manageable for some, may represent years of saving for others. Coupled with the continuous rise in rent rates, accumulating savings for a house has become an increasingly formidable challenge. Fortunately, there exist viable methods to buy a home with a lesser down payment responsibly. In addition, CrossCountry Mortgage can assist eligible homebuyers in accessing extra monetary support through first-time homebuyer grants.

Debunking the 20% Down Payment Rule

The requirement of a 20% down payment, shaped by past norms and conventional wisdom, has become a standard in the homebuying sector. This tradition has evolved due to certain benefits, such as bypassing Mortgage Insurance or securing lower interest rates. However, it might be more prudent, depending on your financial situation, to make a smaller down payment and invest the remaining money elsewhere or use it for closing costs and renovations. The affordability of a home isn't merely about the size of the down payment. It involves being able to manage the mortgage payments and additional homeownership expenses throughout the loan's lifespan. A wide array of loans require a minimal down payment (as low as 3.5%) or none at all for qualified buyers. At CrossCountry Mortgage, we provide an array of loan solutions catering to buyers who need greater financial flexibility. Discover more about your options here.

The Dynamics of First-Time Homebuyer Grants

While the US government doesn't directly dispense loans, it provides federal funding that fuels many first-time homebuyer grants. This funding is distributed among states, which in turn establish diverse grant programs for homebuyers. Due to this distribution system, program availability will differ across states. However, in most situations, the prerequisites remain consistent. For instance, these grants are typically applied to reduce some of the purchasing expenses, including down payment and closing costs, and do not require repayment provided you inhabit the house for a specified duration.

First-Time Homebuyers Juggling Student Debt

According to a 2018 report from The Institute for College Access and Success (TICAS), 65% of graduating seniors from public and private nonprofit colleges bore student loan debt. In Oregon alone, the average student debt amount in 2017 stood at $27,885. These figures encompass only students pursuing bachelor's degrees at private or public four-year colleges and rise even higher for postgraduate studies. These statistics underscore the need not to let student loan debt derail your homeownership aspirations. Fannie Mae offers three solutions potentially enabling applicants to qualify for a conventional mortgage despite their student debt.

In Conclusion

Despite appearing unreachable, homeownership is attainable. Tax breaks, first-time homebuyer grants, and flexible loan programs all contribute towards making homeownership feasible. If you're uncertain about where to start or how homeownership could influence your financial objectives, don't hesitate to reach out to our experienced Mortgage Advisors for further details.

Whether you're poised to buy today or merely planning for the future, CrossCountry Mortgage is here to assist. Connect with us today for a no-obligation consultation!