Real Estate

The Ultimate Guide for First Time Home Buyer Program in Utah

The dream of owning your first home comes with so much excitement. Thus, when looking for the best first time home buyer program Utah, some things may slip off, resulting in endless regrets. That is why we gathered some important tips for first-time homebuyers in Utah. In this post, we will share tips for Utah housing first-time homebuyer program, along with basics for ensuring you make the right purchase decisions. Keep reading to discover the secrets when buying your first home. 

Understanding Different First Time Home Buyer Programs Utah

Utah’s first-time homebuyer programs are designed to provide the needed assistance when buying the first time. There are different programs classified under the Utah housing first-time homebuyer programs. Here is an overview of the different programs for first-time homebuyers in Utah. 

The conventional home mortgage for first-time homebuyers is not insured by the Federal Government. The first time home buyers can get the conventional mortgage with as low as 3% down payment, so long as the mortgage option conforms to the requirements set by Fannie Mae and Freddie Mac. Unlike the Government-sponsored first-time homebuyer programs, the conventional home loans allow the borrowers to cancel the mortgage insurance or to avoid the mortgage insurance, so long as they pay at least a 20% down payment. 

  • The FHA Home Loan

Insured by the Federal Housing Administration, the FHA home loan is suitable for first time home buyers who have a low credit score and looking to pay a low down payment. Essentially, a first-time homebuyer with a credit score of as low as 580 can apply for the FHA home loan, with a down payment of as low as 3.5%. Note that borrowers with a credit score of as low as 500 can qualify for the FHA home loan so long as they are able to pay a down payment of 10%. Note that all the FHA home loans do require that the borrower pays the mortgage insurance, and it cannot be canceled. 

  • The VA Home Loan

Classified under the Utah housing down payment assistance program, the VA home loan is insured by the US Department of Veteran affairs. The VA home mortgage is available to the members of the US military, the veterans, and the surviving spouses. Thus, if you are looking to purchase a home and you qualify for the VA home loan, you do not need to have a credit score, no need to pay a down payment, and there is no mortgage insurance. However, you have to pay the VA funding fee. Note that, the VA home loan falls under the zero down payment mortgage options. 

  • USDA Loans

This is a zero down payment mortgage, sponsored by the US Department of Agriculture. The USDA home loan is a first time home buyer program suitable for buyers interested in properties that are within the eligible rural and suburban areas. However, note that the USDA home loan comes with income limitations, varying from one region to another. Further, the USDA home loan is available to the applicants who have a credit score above 640. For those with a credit score below the set limit, the mortgage lenders demand stringent underwriting standards.

The first time homebuyers applying for the home buying programs covered above will get competitive rates for 30-year mortgages. However, the mortgage lenders require that the applicants must use the loan to purchase a primary residence within Utah. Further, a majority of the mortgage programs come with income limits, while some programs do have home-price limits. 

Before applying for either of the above home mortgage options, it is advisable that the applicant goes through the program-specific requirements before sending the application. 

Here are important tips to qualify for the first time homebuyer programs Utah. 

  • Ensure You Have a Good Credit Score

The mortgage lenders will always ask to know your credit score. In that regard, before you apply for a mortgage, be sure that your credit score meets the minimum set by the mortgage lenders, for the particular home loan program. For those who qualify for the VA home loan, you do not need to worry about the credit score. 

  • Save for a Down Payment

To qualify for a mortgage, you have to raise the minimum down payment as required by the mortgage lenders. Thus, open a savings account and start saving for the down payment. 

  • Talk to a Reputable Mortgage Broker

Mortgage brokers will help you to secure for the best mortgage irrespective of the mortgage option you are applying. Thus, start searching for the best mortgage brokers, and engage them. 

Applying for a home loan requires adequate preparations. Never rush through the process of shopping for the best Utah housing down payment assistance program. 

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