Let's talk about first time home buyer grants. Buying a house is tough in any economy, but for millennials (who are still earning 30% less than older generations did at their age), it might seem completely impossible. Fortunately, that's what mortgage grants are for.
There are a variety of great opportunities available for low and middle income families that are looking for a way to break out of the rental lifestyle.
Down Payment Assistance
The most obvious hurdle facing a first time home buyers everywhere is the huge down payment that's usually required to buy a home. Most banks will require you to put down 20% of the house's purchase price when you take out your mortgage, and most millennials simply don't have that kind of cash, and don't have the means to save it up. Down payment assistance grants are offered by state and local governments all over the country, and are designed to help defray some of the cost of those big down payments, as well as other fees and closing costs. This helps to lower that high barrier to entry, so that it's easier for people who can't save big lump sums of cash to become homeowners.
FHA Loans
Another way to bring down those costs is to apply for an FHA loan. FHA loans are backed by the federal government, meaning that banks don't have to shoulder the kind of risk to issue the loan than they would with a regular mortgage. As a result, an FHA down payment is only around 3.5% of the home's purchase price, instead of the usual 20%. Used in combination with a down payment assistance grant, home buyers can often afford to get into a new home without any out-of-pocket down payment required at all.
Good Neighbor Programs
These types of home buyer grants are meant to help people who work in "good neighbor" professions like teachers, police officers, members of the military, paramedics, firefighters, and others. They're designed to make it easier for people in these professions to establish themselves in the middle class, and to help revitalize and stabilize shrinking or deteriorating neighborhoods. Good neighbor program are most often funded by HUD block grants that are administered locally by the county or city.
We hope you enjoyed our look at some of the first time home buyer grants that you can take advantage of as a millennial first time home buyer. Check back later for more updates!
