We wanted to create a section just for people who are not accustomed to buying a home. We have clients all the time asking what sort of incentives are out there for first-time home buyers. First, we want to point out that depending on money saved, credit score, debt-to-income ratio (DTI) and a bunch of other items, let your lender be the expert in recommending what the best loan option is for you.
With that being said, make sure your lender is a ROCKSTAR! It really does matter when it comes to who you choose to work with. We have an amazing list of local lenders who can walk you through the entire process. Just contact us!
There are multiple loans notated in the “FINANCING” section of our website. Please refer to that section for a variety of standard loan options. As mentioned before, it is best to talk to a lender to verify the best option for you.
Directly from https://www.idahohousing.com/homebuyers/home-loans, Idaho housing is a great option for first-time home buyers that provides low mortgage rates, down payment assistance and closing cost assistance.
Whether you’re buying a house or refinancing, Idaho Housing offers home loan options including: conventional loans, Rural Housing development, FHA and VA loans.
They also offer a homebuyer tax credit where you can get up to $2,000 or 35% of the total mortgage interest paid in income tax credits each year for the life of the loan as well as homebuyer education and support through the life of your loan.
To be eligible for the Idaho Housing Loans, a homebuyer can make up to $150,000 per year. Property Types include: single family, townhouse, condos and manufactured housing.
How to buy a home with Idaho Housing (this information was gathered directly from the Idaho Housing website at https://www.idahohousing.com/homebuyers):
1 – GET EDUCATED:
Finally Home!®, their homebuyer education program, is the perfect starting point for potential homebuyers. Finally Home! will help you:
• Decide when you are ready to purchase a home.
• Determine what type of home best fits your needs.
• Understand what you can afford.
• Learn about affordable financing options.
• Understand every step of the home-buying process.
• Understand you do not need 20% down to purchase a home.
This website link is: https://www.finallyhome.org/en/homebuyer-education
2 – GET CONNECTED:
The next step to obtaining an Idaho Housing loan is finding a participating local lender. Just reach out to our team to connect you with one of our highly competent lenders. They will walk you through every step of the home-buying process and help you find the loan that best fits your situation.
3 – GET LOOKING:
Once you are pre-approved by your lender, you will have a clear understanding of how much home you can afford. This will help narrow your search and make the house hunting process less stressful. Then we can help you with the following:
• Determine how much homes are worth, based on other homes that have sold recently. Another way we phrase this is “run comps” or “comparisons”.
• Take you to homes you might be interested in.
• Help you write the purchase offer.
• Negotiate with the seller to get the right price.
• Be with you every step of the way to complete the home-buying process.
DOWN PAYMENT ASSISTANCE:
How to use down payment assistance with Idaho Housing (this information was gathered directly from the Idaho Housing website at https://www.idahohousing.com/homebuyers/down-payment-closing-cost-assistance):
HOW IT WORKS:
When you buy a home, you are required to pay a down payment. A down payment is a contribution toward the purchase of your home that you pay upfront, before moving in. The minimum down payment you need depends on the type of mortgage you’re using to buy your home, but typically ranges between 3% and 5% of the sales price of the home. Many aspiring homebuyers struggle to save a 3% down payment, especially as rising home prices in Idaho push that amount higher. Enter: down payment assistance!
Idaho Housing’s down payment assistance program eases the upfront financial cost of buying a home and allows you to start building generational wealth sooner. This program provides homebuyers with up to 10% of the sales price of the home to use towards the down payment and/or closing costs. Idahoans who use this program can contribute as little as 0.5% of the sales price of their own funds to the purchase.
If you want to buy a $400,000 home using an Idaho Housing conventional loan, the minimum down payment you would need to provide out-of-pocket is $12,000 (3.0% of $400,000).
If you used down payment assistance through Idaho Housing, you would only need to provide $2,000 of your own funds towards the purchase (0.5% of $400,000). Idaho Housing would provide the additional financing needed.
NOTE: 0.5% is the minimum contribution of your own funds you would need to provide. Some homebuyers elect to contribute more than the minimum. Your mortgage lender will help you determine what is best for your situation.
The additional financing is loaned to you via a second mortgage or a forgivable loan.
Second mortgages are paid back alongside your primary mortgage through small monthly payments. Idaho Housing offers second mortgages at a fixed interest rate of 7% over 15 years. Spreading the second mortgage out over multiple years makes the additional monthly payments affordable and sustainable. A forgivable loan is assistance in the form of a zero-interest loan that is gradually forgiven overtime. Based on how much down payment assistance you need, the interest rate on your primary mortgage will increase (0.125% interest rate increase for every 0.5% of forgivable loan used).