First Time Home Buyer & Assistance Programs
As a first-time home buyer, it’s especially important to understand your options to be sure you’re saving as much money as possible. Navigating the mortgage landscape can feel overwhelming, but several specialized programs may offer flexible eligibility and assistance with down payments and closing costs. These programs can include Federal and State-backed loans that allow some borrowers with lower credit scores or limited funds to pursue homeownership. Your AFC Mortgage Loan Expert will be able to provide you with specialized guidance and determine which program(s) you qualify for, helping you find the right path to homeownership.
Loan Programs for First-Time Buyers
- FHA Loan: FHA loans are a popular option, backed by the Federal Government through the Federal Housing Authority. This program was established to offer more flexibility in qualifying along with lower down payments, making it easier for many first-time buyers to enter the market.
- FHA 203K Rehab Loan: This loan allows FHA-qualified homebuyers to combine a mortgage and home renovation costs into a single loan. This is an excellent option if you find a home that needs some work, as it streamlines the financing process and allows you to make your dream home a reality with one convenient mortgage.
- State-Sponsored Loans (such as CHFA): The Connecticut Housing Finance Authority (CHFA) is a quasi-public agency that offers a variety of loan programs with below-market interest rates to help low- and moderate-income individuals and families achieve homeownership. Many of these programs also offer down payment assistance, which can come in the form of a forgivable loan. A great example of this is the Time To Own (TTO) loan program.
- What is the Time To Own (TTO) Loan? The TTO loan is a special type of down payment assistance that is a 0% interest rate loan with no monthly payment required. The key feature of this program is that it is "forgivable," meaning a portion of the loan is forgiven each year until it is fully forgiven after a set period, typically ten years. This program is available to eligible applicants who qualify for and receive a CHFA first mortgage. It's designed to help cover the upfront costs of a home purchase, such as down payments and closing costs, to make homeownership more accessible.
- Eligibility for CHFA Programs: To qualify for most CHFA programs, you must be a first-time homebuyer or not have owned a home in the past three years, with an exception for those purchasing in federally designated "Targeted Areas." Your income must also fall within specific limits for your area, and the home you purchase must meet sales price limits.
- VA Loan: A VA Mortgage is a loan guaranteed by the Department of Veterans Affairs for eligible active or veteran service members. It offers substantial benefits, including a low or no-down-payment option and no required private mortgage insurance (PMI). See our page on VA Loans for more details!
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Reach out today for personalized guidance from AFC Mortgage Group. Call us at 203-452-9899.