There are diverse programs that ascribe to first time home buyers, but are not necessarily designed for those individuals who have not actually ever owned a home. The majority of programs describe a first time homebuyer as a person who has not owned a home for period of generally three years. Notwithstanding, a person may have been an homeowner several times throughout their lifetime for short periods, but as far as the program requirements are concerned, such an individual may still be eligible. All first time home buyer programs carry different requirements/rules, thats why it is manditory for applicants to understand the several criteria before applying to any one program.
Most first time homeowners biggest obstacle is not having enough money for the down-payment and closing cost. One of the challenge's that most first time homeowners face, they were renting before, so how can you save to buy when there is rent to pay? This can be virtually impossible for some. People who ultimately possess their own home would have experienced a time of substantial appreciation in property values in past years, but not so in recent years. So in the event that these homeowners would like to sell their home and purchase another they can use the appreciation for a down-payment. First time home owners however do not have any home value appreciation to benefit from. This is where the state governments came in because of these issues and have developed several first time home buyer programs.
Government First Time Home Buyer Programs
The U.S government has recognized that homeowners are also consumers and they play a big part in the economy. The government therefore encourages people to make that leap by enabling them to move from renting to owning, one of these such programs offered by the government is The American Dream Down-payment Initiative (ADDI) a (Department of Housing and Urban Development) program which is offered to first time home buyers.
The American Dream Down-payment Initiative (ADDI) money can be used by a person that wishes to make a down payment on a home and can simultaneously be used to pay the closing costs. There are homes that require certain repairs, which may include the repair of unsafe or unhealthy conditions, you also can use ADDI money for this purpose. Each individual state is responsible for the distribution of ADDI funds, but not every state has money available for all eligible applicants.
Beware of Unscrupulous Lenders
Because many first time home buyers are uneducated regarding the various mortgage products offered, some scrupulous lenders will label certain piggyback loans and interest only loans as first time home buyer loans. In fact, the lender is simply taking a confusing loan and making it look very attractive to applicants who may not fully understand what they are getting themselves into.
Author Resource:
Oliver Silverstones makes it easy for the first time home buyer , to find all the state and local first time buyer programs. He keeps an update of the best fixed rate mortgage rates daily, as well as providing great advice to avoid most first home buyer headaches.
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