The tide is turning again for interested home buyers, even if it is their first property purchase. In fact, the conditions are still good for them, so long as they are aware of the requirements that will allow them to finance their purchase.

Home Loan Guidelines For First-time Buyers

In terms of requirements and mortgage qualifications, there is not much of a difference between first-time and repeat property buyers. However, in some cities, there are programs that make it easier and less expensive for them to become homeowners as opposed to renters. Here is a rundown on the requirements first-time home buyers need to accomplish.

1. Down Payment Requirements

If you look for a home loan from a private institution, you will need to put down at least 3% down payment. On the other hand, loans from the Federal Housing Administration (or FHA) allow those eligible to put down a 3.5% down payment. To be eligible, a credit score of at least 580 will be required.

In comparison, VA loans (which are available for military members and veterans) will offer 100% financing. This means first-time buyers will not be required to pay a down payment if they have a VA-guaranteed loan. This is a huge help for wanna-be homeowners who do not have a lot of savings to meet the down payment requirements.

2. Credit Score Requirements

These three digits can greatly affect your mortgage or loan conditions. It shows how much money you have borrowed and paid back in the past. It is based on other loans, credit cards, and other ways to borrow money.

The first thing to do when you decide to buy a home is to check your credit score . This is because all banks or loan providers look for a specific credit score before they sign them up for a loan. Conventional loans will look for about a score of 600 or higher (the FICO scale goes from 300 to 850) but the FHA will look that the home buyer has a score of at least 580 to receive the 3.5$ down payment condition.

Debt-to-Income Ratios

Much like with the other requirements, lenders are becoming more lenient when it comes to debt-to-income ratios. Thanks to some policy changes by Freddie Mac and Fannie Mae, banks and other lenders allow higher levels of debt, especially when compared to 2 or 3 years ago. Because first-time homebuyers might still owe some money on car mortgages or student loans, this change is much needed.

Getting a home loan is presently still relatively easy, which is why wanna-be homeowners should start their search for their dream home before this changes. In fact, if you have always dreamt of having your own home, then now is the right time.

Since the USDA Home Loan Program was started in 2009, more than 650 thousand families were able to purchase their own homes through the programs zero-down payment scheme, flexible credit guidelines, friendlier income level requirements, and competitive interest rates. This figure is as of 2015. Today, more and more individuals and their families are beginning to enjoy the fruits of their decision to avail of such a housing loan program. But one of the most often-asked questions by potential homebuyers related to the USDA Home Loan program is if its available in all states of the US.

To answer this question, it is important to understand what the USDA Home Loan Program is all about. The USDA HLP is a mortgage facility offered to individuals in rural and suburban areas of the United States. As of 2015, this accounts for about 97% of the total habitable land area of the US. It excludes urban centers. That being said, there is no state in the US that doesnt have a suburban or rural area. As such, the USDA Home Loan Program is available in all states in the US.

As of 2015, North Carolina leads in the number of USDA Home Loans with almost 36,000. It was followed by Texas (35,225), Michigan (34,065), Florida (31,844), and Louisiana (27,457). The 5 states with the least number of USDA loans included Alaska, New Mexico, North Dakota, Vermont, and Delaware.

USDA Home Loans are gaining popularity especially in suburban areas surrounding large metropolises. For instance, one of the reasons why North Carolina, Texas, Michigan, Florida, and Louisiana are doing well in terms of USDA loan usage is because people are flocking to the suburban areas of the key cities of these states like Charlotte, Austin, Detroit, Orlando, and New Orleans, respectively. The same is true with the states that make up the top ten including Missouri, Indiana, Tennessee, Pennsylvania, and Illinois.

When it comes to USDA Loans by dollar volume, however, California squeezes into the 5th slot, edging Michigan. This is primarily related to the higher property values in the Golden State compared to those in the Great Lakes State. North Carolina still leads, however.

It is expected that as we look forward to the third decade of the new millennium, more and more individuals will avail of the USDA Home Loan program. It has all the right features that many potential homebuyers look for including zero-down payments, low interest rates, low mortgage insurance rates, and very flexible income limits and credit guidelines. Best of all, youve got 97% of US lands just waiting for you.