First-time homebuyer qualifications

Even if you’ve previously owned a home, mortgage programs and down payment assistance programs may still consider you a “first-time” homebuyer if you fit one or more of these conditions.

• 1. Previous homeownership

  If you’re “an individual who has had no ownership in a principal residence during the 3-year period ending on the date of purchase of the property,” you will qualify as a first-time homebuyer as defined by the U.S. Department of Housing and Urban Development. So it only makes sense that you should know what your credit score is before applying. To find your score, take advantage of the free report. Married couples may qualify for a first-time homebuyer mortgage even if only one meets this requirement.¹

• 2. Divorced parents

  If you’re a divorced or separated parent, and the only primary residence you’ve ever owned was with your ex-spouse, you can qualify as a first-time homebuyer.²

• 3. Mobile home and RV ownership

  If you’ve owned a primary residence within three years, “but the primary residence you owned has not been permanently attached to something like a foundation (such as a mobile home or RV),”³ you may also have the opportunity to qualify as a first-time homebuyer.

• 4. Damaged property owners

  If you’ve only owned property that has sustained damage as such “that was not in compliance with local building code ordinances and which cannot be improved to meet building code standards for less than the cost of constructing a new residence.”⁴

• 5. Displaced homemakers

  If you’re a “displaced homemaker whose only previous ownership was with a spouse.”⁵ The Department of Housing and Urban Development  defines a displaced homemaker as an adult who “has not worked full-time, full-year in the labor force for a number of years but has, during such years, worked primarily without remuneration to care for the home and family; and is unemployed or underemployed and is experiencing difficulty in obtaining or upgrading employment.”⁶

• Federal Housing Administration (FHA) loans are one of the easiest mortgages to qualify for because they don’t require a large down payment, and they are more flexible with credit scores. FHA loans are widely used by first-time homebuyers and can require upfront and annual mortgage insurance premiums.
• Many states offer programs designed to help first-time buyers. Check out this list of homebuyer assistance programs available by state provided by HSH.com.
• First-time homebuyers and individuals with incomes below area median levels can increase their buying power with a down payment assistance (DPA) program. They are available county-by-county to offer first-time homebuyers relief from the costs of purchasing a home. This assistance is provided in the form of a loan or grant–secured as a lien against the property–and is often forgiven over time.

To see if you are eligible to qualify for a first-time homebuyer program, connect with a Guild Mortgage loan officer today.