Who Qualifies as a First-time Homebuyer?

Most homeowners depend on mortgage loans and mortgage assistance programs to purchase a home. However, these programs are confusing as it is challenging to know who qualifies as a first-time home buyer and who is not. Let’s dive into it for better understanding.  

What is a First-time Homebuyer?

This is a term used to refer to someone who is buying their first home ever or someone who doesn’t own a home and hasn’t purchased a home in several years. These homebuyers can sometimes qualify for first time home buyer benefits, including lower down payment requirements and reduced mortgage insurance premiums, sponsored by the federal, state and local governments.  

So Who Qualifies as a First-time Homebuyer? 

Under most programs, a person who qualifies as a first-time homebuyer has not owned a house or home in their lifetime. This is confusing because sometimes those who haven’t owned a home for more than three years can still come into the market and be eligible for the benefits.  Check with your local mortgage expert at Spire Financial on what programs are available and what the specific guidelines are.  State and local governments sometimes have online resources you can use to research as well.    

What are the Barriers to Owning a Home?

The significant barriers to homeownership are access to credit, affordable housing, and down payments. The affordability for buying a home for the average income family has reduced, and it is now expensive to acquire a home. This is the reason the first time home buyer programs and state down payment assistance programs exist.

First Time Home Buyer Assistance

Anyone looking to see if they possibly qualify for down payment or first time home buyer assistance programs should do their research on local programs online and with the help of a licensed local mortgage expert.  In some areas, there can be several different programs available.  

A. FHA Mortgages (federal housing administration) 

This loan is insured by the federal housing administration. An FHA home loan allows borrowers a loan with a lower down payment requirement and credit guidelines that may be easier to qualify for as compared to conventional mortgages.  One thing to remember with FHA home loans is the addition of upfront mortgage insurance and annual mortgage insurance possibly for the life of the loan.    

B. VA Loans 

These loans are available for qualified veterans and active military members. VA borrowers can borrow up to 100% of the lower of the purchase price or appraised value of the home with no mortgage insurance.  VA loan funding fees can be different for each borrower depending on how many times the benefit has been used and the VA disability status of the borrower.  Also, it is possible for a VA borrower to have multiple VA loans if there are extenuating circumstances causing relocation.  VA jumbo loans are also available to qualifying VA borrowers.  

C. USDA Loans

USDA loans are for homebuyers in designated rural areas.  These loans also offer low to sometimes no downpayment.  Borrowers must be below the max income guidelines for their family size as designated in their area.   


With the several home buying assistance programs, it can be confusing to tell who is eligible to be a first-time homebuyer. Your local mortgage expert at Spire Financial can help you discover your options and find the best loan for you and your family.  

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Spire Financial (A Division of V.I.P. Mortgage, Inc.) brings lending expertise to you. All of our loan officers offer personalized communication for every client, guiding them through the process. We can show you ways to maximize your finances and unlock future opportunities. Spire Financial keeps you in control of refinancing, debt consolidation, and home equity. Together, we can achieve your financial goals.



V.I.P. Mortgage, Inc. DBA Spire Financial does Business in Accordance with Federal Fair Lending Laws. NMLS ID 145502. For state specific licensing, visit www.vipmtginc.com/national-licenses/. V.I.P. Mortgage, Inc. is not acting on behalf of or at the direction of the FHA/HUD or the Federal Government. This product or service has not been approved or endorsed by any governmental agency, and this offer is not being made by any agency of the government. V.I.P. Mortgage, Inc. is approved to participate in FHA programs but the products and services performed by V.I.P. Mortgage, Inc. are not coming directly from HUD or FHA. Information, rates, and programs are subject to change without notice. All products are subject to credit and property approval. Not all products are available in all states or for all loan amounts. Other restrictions may apply. This is not an offer to enter into an agreement. Not all customers will qualify.

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