Buying your first home can feel overwhelming, especially when you apply for a mortgage and cover the upfront costs. When looking for a home in North Carolina, there is a perk: the North Carolina Housing Finance Agency can support you with your depositand offer you affordable loans and other ways to save if you qualify.
First-time home loan programs in North Carolina
The North Carolina Housing Finance Agency (NCHFA) operates three programs to meet the diverse needs of potential homeowners: the NC Home Advantage Mortgage, NC 1st Home Advantage Down Payment, and NC Home Advantage Tax Credit.
NCHFA NC Home Advantage Mortgage
NCHFA’s NC Home Advantage mortgage is available to both first-time home buyers and those who already own a home, or for those on “promotion”. A first-time buyer is considered someone who has not owned a home in the past three years.
The program offers a fixed rate mortgage – either a conventional loan, an FHA, a VA, or a USDA loan – and up to 5 percent of down payment support (3 percent for a traditional loan). This assistance is packaged as an interest-free second mortgage that does not require repayment unless you sell your home or pay off or refinance your first mortgage within the first 15 years of your repayment term.
Here are the requirements to qualify:
- Your annual income will not exceed $ 92,000.
- Your credit score is 640 or higher.
- Your debt-to-income ratio (DTI) is no more than 43 percent.
- You are buying either a single family home, townhouse, condo, maisonette (FHA loans only), or a newly constructed home (FHA, VA, or USDA loans only with a minimum credit value of 660).
North Carolina Down Payment Assistance
NCHFA NC 1st Home Advantage Down Payment
NCHFA is also offering $ 8,000 Down Payment Assistance specifically for first time buyers, veterans and buyers in specific target markets as part of the NC 1st Home Advantage Down Payment Program. This support comes in the form of a zero mortgage, which is fully granted after 15 years. To be eligible, you must purchase an NC Home Advantage mortgage and meet the requirements for this program.
Other North Carolina homebuyer assistance programs
NC Home Advantage tax credit
First time buyers and veterans can combine an NC Home Advantage mortgage with the state NC Home Advantage tax credit Mortgage Loan Certificate (MCC) program.
A customer center allows you to apply for a federal tax credit that is equal to either 30 percent of your mortgage interest if you’re buying an existing home or 50 percent if you’re buying a new home. Either way, the balance is capped at $ 2,000 per year, but can be used any year as long as you live in your home.
Note that this incentive cannot be combined with the deposit for the NC 1st Home Advantage.
Other first-time buyer loan programs
While NCHFA can help you navigate your first home purchase, you don’t have to go to the government real estate finance agency to find an affordable first-time home loan. Many mortgage lenders offer little or no down payment mortgages, including FHA, VA, and USDA loans, which can help you get into your first home faster. Discover your options with the guide from Bankrate Loans and Programs for First Time Buyers.
For more home ownership programs in North Carolina, including by city, see HUD.gov.
If you are interested in any of the North Carolina Housing Finance Agency programs, visit the organization’s website for program information and guidance that you will need before you buy your first home. You can also use the website to find one Mortgage lender in your area and may specifically search for Spanish speaking lenders.
Regardless of which mortgage suits you best, it pays to compare lenders and quotes to get the best mortgage rate for your credit and financial situation. You can view the current one Mortgage Rates in North Carolina by bank rate.