If you are a new home buyer there are several programs available that can help make your dream of homeownership a reality. These programs offer different options for down payment assistance, grants, and low-interest loans.

Federal Housing Administration (FHA) loan program

Firstly, one of the most popular programs for new home buyers is the Federal Housing Administration (FHA) loan program. FHA loans are government-backed mortgages that allow borrowers to purchase a home with as little as 3.5% down payment. This program is particularly beneficial for those who have less than perfect credit or limited savings for a down payment. The FHA loan program has a lower credit score requirement compared to traditional loans, making it easier for first-time home buyers to qualify. The downside of FHA loans is that they require mortgage insurance premiums (MIP) which can increase the monthly payment.

Department of Veterans Affairs (VA) loan program

Another option for new home buyers is the Department of Veterans Affairs (VA) loan program. VA loans are specifically designed for veterans, active-duty service members, and eligible spouses. VA loans do not require a down payment, and the closing costs are lower compared to traditional loans. Additionally, VA loans do not require mortgage insurance premiums, which can significantly reduce the monthly payment. To be eligible for a VA loan, the borrower must have a Certificate of Eligibility (COE) and meet certain service requirements.

United States Department of Agriculture Loans

USDA loans are another option for new home buyers who are looking to purchase a home in a rural area. These loans are backed by the United States Department of Agriculture and allow borrowers to purchase a home with no down payment. USDA loans also have lower interest rates compared to traditional loans and do not require mortgage insurance premiums. However, to be eligible for a USDA loan, the borrower must meet income and location requirements.

In addition to government-backed loan programs, there are also various down payment assistance programs available to help new home buyers. These programs provide financial assistance to eligible borrowers to cover the down payment and closing costs. For example, the HomeReady program offers low down payment options and reduced mortgage insurance premiums for borrowers who meet income requirements. Another example is the Good Neighbor Next Door program, which offers significant discounts on the purchase price of a home in certain revitalization areas.

Homeownership Advantage Program (HAP)

In addition to government-backed loan programs, Tennessee offers several first-time home buyer programs that provide grants, loans, and other forms of assistance. The Tennessee Housing Development Agency (THDA) offers various programs for first-time home buyers, including down payment assistance and low-interest rate loans. For instance, the Great Choice Plus program provides up to 5% of the home’s purchase price for down payment assistance, and the Hardest Hit Fund Down Payment Assistance (HHF-DPA) program provides up to $15,000 in down payment assistance for eligible borrowers. Additionally, the City of Nashville offers a first-time home buyer program that provides up to $40,000 in down payment assistance for eligible borrowers.

The City of Nashville offers a program called the Homeownership Advantage Program (HAP) for first-time home buyers. The program provides up to $40,000 in down payment assistance and closing cost assistance for eligible borrowers. The program is designed to help low-to-moderate-income families and individuals overcome the barriers to homeownership by providing financial assistance.

To be eligible for the program, applicants must meet certain criteria, including but not limited to:

• The borrower must be a first-time home buyer or not have owned a home in the past three years.
• The borrower’s household income must not exceed 80% of the area median income (AMI) for Nashville.
• The borrower must complete a homebuyer education course from a HUD-approved counseling agency.
• The borrower must contribute at least $1,000 of their own funds towards the purchase of the home.

The program assists in the form of a forgivable loan, meaning that the borrower does not have to repay the loan as long as they occupy the home as their primary residence for at least five years. If the borrower sells or refinances the home before the five-year period, they may be required to repay a prorated portion of the loan.

The program is administered by the Metropolitan Development and Housing Agency (MDHA) and funded by the U.S. Department of Housing and Urban Development (HUD). The HAP program is one of the many initiatives taken by the City of Nashville to promote affordable homeownership and revitalize neighborhoods.

To apply for the Homeownership Advantage Program (HAP) for first-time home buyers in Nashville, you would need to contact the Metropolitan Development and Housing Agency (MDHA), which administers the program. You can find more information about the program and the application process on their website at https://www.nashville-mdha.org/hap-program/. The website provides details on the program requirements, eligibility criteria, and application process. You can also contact the MDHA directly to speak with a housing counselor who can assist you with the application process and answer any questions you may have about the program.

There are various programs available to new home buyers that can help them purchase a home with very little money down. The FHA loan program, VA loan program, and USDA loan program are government-backed loan programs that offer low or no down payment options for eligible borrowers. Additionally, there are down payment assistance programs, first-time home buyer programs, and state-specific programs that provide financial assistance to cover the down payment and closing costs. It is important to consult with a mortgage loan originator to determine the best program for your specific financial situation and homeownership goals.

Contact Tanya Rodriguez at 423-402-0182 for more information.