Buying your first home can be a difficult and confusing task. However, there are a variety of resources available to help you buy your first home. First time home buyer grants can be a great resource for families looking to fulfill the American dream of homeownership. Every state and region has different grants each with their own restrictions and benefits. This guide will explain the basics of first time homebuyer grants.
What Are First Time Homebuyer Grants?
Most first time homebuyer grants are amounts of money available to people who have never owned a home before. First time homebuyer grants usually are used to pay for down payments on homes as well as closing costs.
How Do First Time Homebuyer Grants Work?
Every first time homebuyer grant is different. Most grants will require you to live in the home you are buying. This means you cannot use first time homebuyer grants to buy rental property.
It is also important to note that many first time homebuyer grants will require you to live in the home for a certain amount of time before you can sell the home. If you sell the home before the predetermined amount of time you will have to pay fees or repay the cost of the grant.
Many first time homebuyer grants also require that you pay the money back. Depending on the first time home buyer grant you use, the repayment of the loan may have to come over a period of time or be repaid when you sell your home.
Who Qualifies For First Time Homebuyer Grants?
Once again every first time home buyer grant is different. Generally, you must have never owned a home. Some first time home buyer grants allow for people who have owned a home to qualify as long as the home ownership occurred in the distant past.
Also, most first time homebuyer grants require that you make under a certain income level. The income limits vary depending on the area and home of interest as well as your family size.
Some grants are also geared for homes in certain areas and neighborhoods. So if you are looking to buy a home in a super desirable location you may not qualify for a first time homebuyer grant.
How Do You Apply For A First Time Homebuyer Grant?
If you are interested in first time home buying grants the first thing you will want to do is check out your local resources. A good real estate broker should have a listing of available programs in your area. You can also check out www.HUD.gov for a listing by state of available first time home buyer grants and programs.
Every first time home buyer grant is different. Some grants require you to personally apply to them, while others must be filled out by lenders on your behalf. Generally, you will need to have a home picked out that you are hoping to purchase.
Being open with your real estate and mortgage broker about your financial situation will help them steer you towards homes in your area that qualify for first time homebuyer grants.
Sources:
http://www.hud.gov/grants/index.cfm
