How Murfreesboro Down Payment Assistance Programs Work

There are a few major expenses associated with purchasing a home, and perhaps the single most significant in most cases is the down payment. And while some first-time homebuyers mistakenly worry that they cannot consider homeownership unless they have the full 20% of the home cost to place as a down payment, this isn't actually true -- in large part because of several different down payment assistance programs out there. 

At Primary Residential Mortgage, we're happy to help clients throughout Murfreesboro and other parts of Tennessee with all their mortgage and homebuying needs, including everything from conventional loans to many other programs like FHA loans, VA loans and more. We'll also help you organize down payment assistance if this is something you're in need of, as many borrowers are. How do these programs work, what are some examples of them, and how do you qualify? Here's everything you need to know.

Basics on Down Payment Assistance Programs

As their name suggests, down payment assistance programs refer to programs that help you access some of the down payment on a home. This is helpful for many different reasons, including the fact that it lowers your monthly payments and total expenses because you will be paying less upfront.

But more than that, these programs can also make it easier to qualify for a mortgage -- especially if you are just starting out in your career or have a less-than-perfect credit history. There are both government and non-government programs available, ranging from state assistance to local or community programs.

How Do They Work?

These programs may vary slightly from one another in terms of eligibility requirements, so make sure you explore your options and check with us to see what would work best for you specifically. In general, though, the goal of these programs is to strengthen homebuyers' financial situation so that they can afford a mortgage, and typically this means helping them with down payments, closing costs and even arranging lower-than-market interest rates.

To access any of these programs, first you'll need to be pre-approved for a mortgage -- which we can help you achieve at Primary Residential Mortgage. Then, you can determine which programs will best serve your needs and apply for them through the appropriate channels.

Different Types of Down Payment Assistance

There are actually four separate types of down payment assistance you may be eligible for. These include:

• Interest-free loans: These loans are meant to help borrowers access a larger loan amount by providing the interest payments for a period of time.
• Grant programs: In these cases, you will receive a grant from the program organizers that does not need to be repaid. This money may be used as part of your down payment or other expenses.
• Interest-bearing loans: There are also certain programs offering interest-bearing loans, which means that you'll need to pay the money back eventually.
• Hybrid loans: These are forgivable loans that will not need to be paid back if you live in the home for a particular period of time, usually 30 years or more.

Who Qualifies?

Generally speaking, these programs are meant for people who fit certain criteria, including:

• First-time homebuyers.
• People who live in a specific geographical area.
• People with low income or unstable income sources (this is more common among government programs).

Programs may also have special requirements depending on their source and the types of loans they fund, so check with us at Primary Residential Mortgage to learn more about your options. And remember that these programs may not be available in all areas, so we can also help you explore other ways of accessing some of the down payment money you need for a mortgage.

Kinds of Homes Covered

While this can vary somewhat, the most common types of home that will be covered by down payment assistance programs is the single-family home. These will typically be homes that are not considered very high-end or luxurious, but they may also include condos in some cases.

Specifically, there are a number of property types that are not covered. Second homes, vacation homes, investment properties and certain other types of homes are not eligible for these programs. And remember that it is very important to take the time to explore your options, talk with us and ensure that you can qualify.

There may also be certain restrictions on things like the home's price and the loan amount, so make sure you review all of the guidelines carefully. These will vary from state to state, and sometimes even from city to city.

Finding the Right Down Payment Assistance Program

If you believe you may benefit from one of these programs, it's important to begin looking into them right away. You can start by checking with us at Primary Residential Mortgage to learn more about your options and determine which program is best for you. We'll review your unique situation and help guide you towards the assistance that will be most beneficial and make homeownership a reality.

The down payment assistance programs available will depend on a number of factors, including your location, income and the type of home you want to buy. For example, some government-sponsored programs may provide special subsidies for certain populations or in specific geographical areas; other private programs may be available only for first-time homebuyers or those with lower incomes. It's important to explore the assistance programs available in your area and determine which of them will best serve your needs and apply for them through the appropriate channels. We'll be happy to help you explore your options, answer any questions you may have and ensure that you qualify for the assistance program that is right for you.

For more on this, or to learn about any of our Murfreesboro mortgage rates or home loan programs, speak to the team at Primary Residential Mortgage today.

For more on this, or to learn about any of our Murfreesboro mortgage rates or home loan programs, speak to the team at Primary Residential Mortgage today.