First Time Home Buyer

 Programs in North Carolina

Complete First Time Home Buyer Programs Available in North Carolina.

The state agency created by the legislature in North Carolina to offer first time home buyer programs is the North Carolina Housing Finance Agency. Here is a summary of the current first time home buyer programs that are offered:

First-Time Home Buyer Mortgage

We offer 30-year, fixed-rate FHA, VA, USDA, and conventional mortgages at interest rates that are below market rates to first-time home buyers. FHA loans are insured by the Federal Housing Administration; VA loans are guaranteed by the Department of Veterans Affairs for eligible veterans; USDA loans are guaranteed by the U.S. Department of Agriculture for rural areas; and conventional loans are insured by a private mortgage insurance (pmi) company. This insurance is paid to the lender if the buyer defaults on the loan. Loans are available through participating lenders.

Down payments are usually 0% to 3% of the sales price. VA, USDA, and conventional loans offer 100% financing to qualified buyers.

Down payment assistance up to $7,000

Home buyers who need help with the down payment and closing costs may qualify for interest-free, deferred second mortgages up to $7,000. You pay $750 from your own funds, and the loan pays up to $7,000 of the balance.

Payment on the principal isn't due until 30 years from the date of the loan. Payment is due earlier if you sell, transfer, or refinance your home; if your loan goes into default; or if the home ceases to be your principal residence.

Second mortgage up to $20,000

You also may be able to qualify for assistance through selected nonprofit or government agencies that offer deferred second mortgage loans of up to $20,000 for the purchase of their newly constructed homes.

Mortgage Credit Certificate (MCC)

If you meet the income qualifications but do not qualify for the First-Time Home Buyer Mortgage due to credit problems, the type of home you are purchasing, or a high ratio of debt to income, we may still be able to help you through a Mortgage Credit Certificate (MCC). This federal tax credit was authorized by Congress to assist home buyers with moderate and low incomes.

For complete details on these first time home buyer programs available to North Carolina residents, visit the North Carolina Housing Finance Agency website.

It is highly recommend that you also visit the First Time Home Buyer Grants page for free assistance with the down payment. This will make it possible for many people to qualify for a first time home buyer loan who wouldn't have qualified without the grant assistance.

Best Lender For First Time Home Buyer Loans

Unfortunately, some lenders do not like to work with first time home buyers (due to not having a track record), and prefer instead to only provide mortgages to people who have previously owned a home. If you do not need help with the down payment and are not in need of any state program, but simply want to apply for a mortgage, we recommend  ING DIRECT Orange Mortgage They have great rates, an easy online application, and welcome first time home buyers. Additionally they have not been as severely hurt by the subprime mortgage crisis and are still approving the majority of applications.

Other First Time Home Buyer Programs & Resources