Buying a property for the very first time is really exciting. You may buy a couple of properties later in your life but you won’t quite get the same experience. Having said so, it is also a daunting task that would often push you into a state of dilemma. And the biggest of it all is choosing the right mortgage programs. Given the fact that there are several first time home buyer programs in Houston, making the right choice is never easy. Here we shall walk you through the loan options you have in hand as a first-time property buyer.
- Conventional Loan – If you have a good Credit Score of 680 and above and don’t want to go through the rigorous process of documentation, then this is perhaps one of the best options you have at hand. Conventional loans are easier to avail and don’t require any mortgage insurance if you put 20% or more as down payment. This loan program has greater limits than government aided loan programs and follows Fannie Mae or Freddie Mac mortgage standards. You can get finance up to 97% which is one of its greatest USPs. These loans can be used to fund a second property or one for investment without any restriction.
- FHA Loans – This is surely the most popular loan program that is available in the United States. If you have a poor credit score of 530, then also you are eligible for this loan. It is primarily meant for people who have low income or high exposure to other debts. If you have a credit score of 580 and above or don’t have any credit history to your name, then you can avail this loan by making merely 3.5% of the loan amount as down payment. While those between 530 and 579 can avail this loan by making a down payment of 10%.
- VA Loans – If you have served the nation with honor, this is perhaps the best loan option for you. Veterans Administration loan program requires you to have a minimum credit score of 530 where you can avail 100% financing for your property for loans up to $417,000. It offers up to 60% debt to income ratio and comes with the option of 10, 15, 20, 25 or 30-year fixed-rate mortgage. In case you aim for a loan amount larger than $417,000, you can opt for the VA Jumbo loan where you would need a credit score of 620 and need to pay 20% of the loan amount greater than $417,000 as down payment.
- USDA Loans – The United States Department of Agriculture loan is primarily aimed at people residing in the rural areas and especially for low-income people who would find it tough to avail other home loans. To avail this loan, you must have a credit score of more than 581 and can borrow 100% mortgage pretty easily. This loan can be used to purchase a dwelling, rebuild it or carry out repair and renovations. You will have to make the dwelling your permanent residence and purchase it within eligible
- Rural Housing Loan – For a person living in a designated rural area, there are very few loan programs that are as attractive as this one. It is highly flexible and allows borrowers to enjoy up to 100% financing for their homes. It is mandatory for the loan seeker to occupy the property as primary residence. The eligibility criterion for this loan program isn’t as stringent as some of the other programs and thus, it is extremely popular.
These are some of the best first time home buyer programs in Houston and before choosing one, you should spend a good time doing some research on them. You can also seek help from an expert lending company in this regard as they would make it a better and easier for you.
About Author: Joan Gallardo with his 18+ years of experience as Senior Loan Officer, is a wealth of knowledge dealing with different kinds of loans and guides clients to avail the best mortgage lender in Houston. He regularly publishes blogs and articles surrounding different topics including those on first time home buyer programs in Houston.