What programs are available for first-time homebuyers?

Many programs assist first-time homebuyers. Federal options include FHA loans (low down payment), VA loans (0% down for veterans), and USDA loans (0% down for rural areas). Conventional 97 loans offer 3% down. Additionally, every state has specific programs, often providing down payment assistance or favorable loan terms.

Can I use IRA money for a down payment on a house?

Yes, you can. The IRS allows first-time homebuyers to withdraw up to $10,000 from their IRA accounts without incurring the standard 10% early withdrawal penalty. While traditional IRA withdrawals are still subject to income tax, Roth IRA withdrawals can be both tax-free and penalty-free if the account has been open for at least five years.

What credit score do I need to buy a house as a first-time homebuyer?

The required credit score varies by loan type. For an FHA loan, you may qualify with a score as low as 580 (with 3.5% down) or 500-579 (with 10% down). VA and USDA loans typically require a score of 620 or higher, though some lenders may go lower. Conventional loans generally require a score of 620-640 or higher.

Are there grants for first-time homebuyers that I don't have to pay back?

Yes, many down payment assistance programs are structured as grants that do not require repayment, provided you meet specific conditions, such as living in the home for a certain number of years. National programs like the National Homebuyers Fund and local/state housing finance agencies frequently offer such grants.

How do I find state-specific first-time homebuyer programs?

The best way to find state-specific programs is by visiting the official HUD.gov website. HUD provides a directory of state housing finance agencies, which administer these programs. These agencies can offer information on local loan products, down payment assistance, and eligibility criteria.

Is a home inspection mandatory for first-time homebuyers?

While not always legally mandatory, a professional home inspection is highly recommended and often a condition of the mortgage lender. It helps identify potential issues with the property before purchase, allowing you to negotiate repairs or reconsider the offer. Skipping it can lead to significant unexpected costs later.

What is the Good Neighbor Next Door program?

The Good Neighbor Next Door (GNND) program, sponsored by HUD, offers a 50% discount on the list price of homes in revitalization areas for eligible teachers, law enforcement officers, firefighters, and EMTs. Participants must commit to living in the home as their primary residence for at least three years.

First-Time Homebuyer Guide 2026: Programs & Grants | One…