First Time Home Buyers in NC will get a treat at the beginning of February when the NCHFA is due to roll out a new Conventional Mortgage Loan Program that will allow lower down payments and lower monthly payments. The new First Time Home Buyer Loans coming in NC will not be available through all Banks – however, we WILL be offering these mortgage loans.
The new First Time Home Buyer Loans in NC will be available with Down Payment Assistance programs that include a forgivable 2% grant.
The new Conventional First Time homebuyers program will require 3% for the down payment – so those that qualify for the foreseeable loan / grant program will only need a 1% down payment. The new program does allow Builders and Sellers to cover most closing costs associated with buying a home – which means that home buyers could buy a $250,000 with a very affordable 1% down payment of $2500.
Downside To First Time Home Buyer Programs
The NCHFA Programs do have some “catches” associated with them. If you do not live in your home for the minimum 15 years, you will need to pay the 2% back when you sell your home.
There are maximum income caps for these programs, and the income cap for the Conventional First Time Home Buyer Program in 2014 has not been announced.
The minimum credit score required to qualify for these programs is generally higher than the minimum scores we can do for some other programs, like FHA Home Loans in NC, where we can make loans with minimum credit score requirements for a mortgage as low as 580. The minimum required for the new First Time Home Buyer Conventional Loan has not be announced for 2014 – but it will certainly be no lower than 640.
The interest rates for these programs are generally higher than the “market” interest rate available (sometimes by .5% of interest).
The UPSIDE to First Time Home Buyer Programs
You are not required to make any payments on the forgivable loan / grant, so your monthly payments are low. In addition to this, we understand that the Conventional First Time Home Buyer Loans will have Lender paid PMI. This means that the PMI payments will be included in your Principal and Interest and will likely be tax-deductible. This type of PMI arrangement also means that your monthly payments will be lower than traditional loans with PMI.
All of this adds up to being able to afford a little larger home!
There are no geographic footprint requirements with a NCHFA Conventional loan – like there are for USDA Home Loans, making it easier to live near jobs in Metro parts of NC.
The 2014 Mortgage Tax Credit Certificate program has not been updated on the NCHFA site yet, but with this new First Time Home Buyer Loans NC, you should be able to use the MCC Tax Credit. It gives home buyers that qualify a maximum of $2000 a year, for the life of your loan – and you can still write off your mortgage interest!
So what are you waiting on? Tired of Renting? Buy a House!
When you buy a house, you get a RAISE! (It’s TRUE! Check out the Tax Advantages of Home Ownership!) Call Steve and Eleanor Thorne, in Cary NC for more details about Mortgage Rates 2014 - 919-649-5058! IF you have questions about the New First Time Home Buyer Loans Coming in NC, call us! We answer the phone on weekends!