Florida Mortgage and Down Payment Assistance Programs You Should Know About

When you’re struggling to pay off student loan debt and other expenses, coming up with enough money to put a down payment on a house can be difficult. Fortunately, there are quite a few down payment assistance programs in Florida that can help. In this blog, we’ll cover the different types of loans and grants available, how to qualify for them, and how to apply.

Buyer Requirements

You may be surprised to learn that you can be considered a first-time homebuyer even if it’s not your first home purchase. That’s right – if you haven’t owned a home in at least three years, you are reclassified as a first-time homebuyer.

All of Florida’s loan assistance programs are 30-year, fixed rate mortgages. If that’s something that appeals to you, keep reading. 

To qualify for a Florida first-time buyer loan, buyers must meet the following requirements: 

     – Must meet income, credit, and purchase price requirements

     – Must complete a homebuyer education course

     – The property must be a primary residence located in Florida

Florida First-Time Home Buyer Programs

State Housing Initiatives Program (SHIP)

This is a program that’s used all across Florida. The state gives money to individual counties to assist first-time homebuyers with their down payment and closing costs. 

Where to apply: Contact your county’s local SHIP administrator 

 

Florida Assist Second Mortgage Program (FL Assist)

FL Assist is a deferred second mortgage program that lends $7,500 at 0% interest to first-time homebuyers. Repayment isn’t required until ownership changes or the home is sold. It’s possible to refinance this type of loan, but payment will be required at that time.

Where to apply: Contact the Florida Housing Finance Corporation

 

3% HFA (Housing Finance Agency) Preferred Grant

This grant is designed to provide qualified borrowers with 3% of the home’s purchase price to use toward the down payment or closing costs. Because it is a grant, it does not have to be repaid.

Where to apply: Through your local housing finance agency (HFA)

 

Florida Housing’s Mortgage Credit Certificate Program (MCC)

First-time homebuyers who qualify can claim up to 50% of their paid mortgage interest (capped at $2,000) in the form of a tax credit each year they occupy the home. The tax credit is used as an incentive for buyers to contribute more to their monthly mortgage payments. 

Where to apply: Find a participating lender in your county

 

Assistance Programs for Veterans & Active-Duty Military

To qualify for a military loan, one must:

     – Be a veterans or active military member

     – Be purchasing a primary residence located within the state of Florida

 

Florida First and Military Heroes Loan Programs

These programs are designed for active duty and veteran military members and offer 30-year, fixed-rate mortgages for government-insured loans (FHA, VA and USDA). 

The Military Heroes rates are lower than Florida First. Best of all, you don’t have to be a first-time homebuyer to participate in the programs. Borrowers can also combine these loans with a Florida Housing down payment and closing cost assistance program.

Where to apply: Find a participating lender in your county

Your Credit Score Still Matters

Your credit score is still an important factor when it comes to applying to assistance programs. 

SHIP accepts a minimum score of 560 when considering borrowers, allowing more Floridians to take advantage of the problem. It’s advised that you pay off all debt before applying for assistance and purchasing a house. This will positively impact your credit score, which will get you a lower interest rate and a hassle-free assistance process.

Tips for First-time Home Buyers

Whether you take advantage of Florida’s down payment assistance programs or not, it still pays to be a savvy first-time buyer. The following tips will help you save money and prepare you for any surprise expenses. 

Create an emergency fund. While a monthly mortgage payment may be lower than renting, maintenance on a home can be costly; whether it be repairs, general upkeep, or updates. For example, a new roof on a mid-size home can range from $4,000- $6,000. Experts recommend having an emergency fund with four to six months of living expenses set aside.

Determine what your home budget is. Set your maximum budget for your home and determine how much of a down payment will be needed. Also factor in total costs that will incur monthly when living in the home like mortgage, taxes, utilities, and maintenance. Have an honest conversation with yourself about whether you can afford all of these costs before falling in love with a home.

Save for closing costs. Generally, closing costs are 4% of a home’s cost. Closing costs can include appraisal fees, credit checks, home inspections, and homeowner’s insurance.

Get preapproved for a loan. It’s typically a good idea to get preapproved for a loan before you begin searching for homes to speed up the approval process once you’ve found the home you want.

Find the right neighborhood and home in your price range. Do your research before searching for a home. Does your desired neighborhood fit your price range? Do you like the look and feel of the neighborhood? If you have or are planning to have children, do you like the school district it’s in? Better to spend a few days researching than to spend years in a neighborhood you don’t like.

Make an offer that is competitive but also in your budget. During the research process, gauge how long homes stay on the market and factor that into your initial offer. If you are looking at homes in a city where real estate goes quickly, it’s wise to offer the asking price or even above asking price in very competitive markets. 

Prepare for the closing process. Closing on a home typically takes 30-40 days. Ask your realtor any questions about the paperwork you are not 100% clear on. In the end, it’s your signature on the papers, and you will be responsible for the home once the final documents are signed.

Find Qualified Lenders in Tampa, Florida

The Associates Home Loan of Florida, Inc., is conforming and non-conforming brokerage firm with access to a network of qualified lenders that specialize in alternative lending resources. Whether you’re a first-time buyer or a third-time buyer, we can help you get the best mortgage loan for you – call us today at 813-328-3632 or apply online.