Utah First-Time Home Buying Assistance Programs for 2023

Utah First-Time Home Buying Guide

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    By Kim Franke-Folstad

    (Last Updated – 08/2022)

    It would be tough to pick a more pleasant place than Utah to buy a home, whether you’re into enjoying the great outdoors or prefer life in the big city. But for first-time homebuyers in Utah, putting down roots can be a challenge.

    Though home prices in Utah — and across the country — may cool down in the months ahead if interest rates keep rising, for now, affordability can be a problem.

    According to Redfin, the median selling price of a home in Utah rose to $575,700 in May 2022, a 25.5% increase in just 12 months. In some communities, the numbers were even more daunting. In Salt Lake City, home prices were up 36.3% year-over-year, with a median sales price of $613,500. In Sandy, prices were up 25.2% compared to last year, for a median price of $670,000.

    Fortunately, first-time homebuyers in Utah may be able to get some financial help through programs offered by the state and some cities and counties. There also are longstanding federal programs that could improve a buyer’s chances of success.

    Recommended: The SoFi Guide to First-Time Home Buying

    Who Is Considered a First-Time Homebuyer in Utah?

    The answer to that question isn’t as obvious as it seems. For most programs offered in Utah and elsewhere, applicants are considered first-time homebuyers if they haven’t owned a home for the past three years.

    Some programs may make exceptions for veterans, single parents, and others. It’s a good idea to be clear on specific eligibility standards before you start any application.

    3 Utah Programs for First-Time Homebuyers

    The Utah Housing Corporation (UHC), also known as Utah Housing, provides several assistance options for first-time buyers who might need help obtaining an affordable loan and/or coming up with a down payment.

    Because the programs were established to assist low- to moderate-income buyers, participants may have to meet certain income limits and other criteria. There also may be a limit on how much the purchased home can cost.

    These programs (some of which may also be available to repeat buyers) include:

    1. Utah Housing FirstHome and HomeAgain Loan Programs

    If you’re a first-time homebuyer with a modest income looking for a low interest rate, the FirstHome Loan program may be for you. This program typically offers the UHC’s lowest available interest rate on a first mortgage, which may be paired with a second mortgage for down payment assistance. The FirstHome program is available only to qualifying first-time homebuyers.

    The HomeAgain Loan program has similar benefits and requirements, but it is available to first-time and repeat homebuyers.

    Type of Assistance: Lower-interest first mortgage with the opportunity to obtain a UHC down payment second loan that’s up to 6% of the first mortgage amount. The 30-year fixed-rate second mortgage is fully amortized (it is not forgivable). The second loan interest rate is 2% higher than the first mortgage rate.

    Benefits and Qualifications include:

    •  Second loan can be used for down payment and/or closing costs

    •  Minimum credit score of 660

    •  Must meet UHC income and purchase price limits

    More information: UHC – Home Loans (utahhousingcorp.org)

    To apply: An approved lender can help you get started.

    2. Utah Housing Score Loan Program

    The Score Loan program was created to help families who have recovered from previous credit challenges purchase a home. The program provides borrowers with a first mortgage and the opportunity to apply for a second mortgage of up to 4% of the first mortgage amount for down payment assistance and/or closing costs. It is available to both first-time and repeat buyers.

    Type of assistance:First mortgage can be paired with a fully amortized, non-forgivable second loan with an interest rate that is 2% higher than the first mortgage and can be up to 4% of the first loan amount.


    •  Minimum credit score of 620

    •  Must meet UHC income and purchase price limits

    More information: UHC – Home Loans (utahhousingcorp.org)

    To apply: An approved lender can help you get started.

    3. Utah Housing Veterans First-time Homebuyer Grant

    Utah Housing has a grant program that benefits qualifying Utah veterans who are first-time homebuyers. The grant is for $2,500, and it doesn’t necessarily have to go toward the recipient’s down payment and closing costs.

    Benefits and Qualifications include:

    •  Homebuyers can choose any conforming mortgage type, such as VA, FHA, Fannie Mae, or Freddie Mac

    •  Can use any lender licensed to originate mortgages in Utah

    •  Must be a first-time homebuyer in Utah (can have owned a home in another state)

    •  Must obtain Veterans Grant Status Validation from the Utah Department of Veterans and Military Affairs

    •  Lender must receive a Veterans Grant Reservation Agreement from Utah Housing prior to closing

    •  Funds are limited; it’s important to pay attention to all deadlines

    More information: UHC – Grants for Veterans (utahhousingcorp.org) You also can contact the Department of Veterans and Military Affairs at 801‑326‑2372.

    To apply: Take your Veterans Grant Status Validation to any lender licensed to originate loans in Utah and ask about a Utah Veterans Grant.

    Other Utah Homebuyer Programs by Location

    If you already know which Utah community you hope to make your home, you also may want to research local first-time homebuyer programs. If you can’t find assistance in your chosen location, you may want to check back occasionally for new offers. Some first-time homebuyer programs base their opportunities (and deadlines) on the funds they expect to become available. When their money runs out, they may press pause.

    Clearfield City Down Payment Assistance Program

    Qualifying first-time homebuyers in Clearfield City may qualify for a matching grant of up to $7,500 to help cover their down payment and closing costs. The grant, which is administered by the Davis Community Housing Authority, is forgiven over a period of seven years. It can be used for a single-family detached home, condominium, or townhome with a maximum purchase price of $400,000.

    Applicants must meet income limits and other criteria. You can go to the program’s web page to check out the benefits and requirements, or call 801-939-9198 to verify the availability of funds.

    At Home in Layton Down Payment Assistance Program

    Layton City offers the At Home in Layton Down Payment Assistance Program to income-eligible first-time homebuyers. The assistance comes in the form of a grant of up to $7,500 that can be used for a down payment, closing costs, or principal reduction. If the purchased home is sold before the end of the fifth year after closing, all or a portion of the grant may have to be repaid to the city.

    Funds are limited, and applications are accepted on a first-come, first-served basis. For more information, you can check out the program’s web page or go to the brochure for application guidelines . Contact the Layton City Community Development Block Grant administrator at 801-336-3770 or [email protected].

    Own in Ogden Loan Program

    The Own in Ogden loan program provides qualifying first-time and repeat homebuyers with a 0% interest, deferred-payment second loan for their down payment or closing costs. The loan also can be used to reduce the principal on the buyer’s first mortgage.

    •  Homebuyers can receive $10,000 to purchase a primary residence in Ogden

    •  State-certified K-12 classroom teachers or administrators in schools that serve city students can receive a $15,000 loan

    •  Ogden employees and new hires who don’t currently live in the city can receive a loan of up to $15,000 to help them move there

    •  Ogden police officers and firefighters can receive a $20,000 loan Income and purchase limits apply. For more information, you can go to the program’s web page or go to the program brochure for application guidelines .

    Provo Home Purchase Plus Program

    The Provo Home Purchase Plus Program offers eligible homeowners the opportunity to apply for a 0% interest, deferred-payment second loan to help pay their down payment and closing costs. Payment is due in full when the borrower no longer lives in the home as their primary residence. (If the home is sold or vacated within two years of purchase, there may be a $5,000 penalty.)

    Income limits, asset limits, credit requirements, and purchase price limits apply, and all household members over 18 must pass a background check. For more information, check out the program’s web page or call 801-852-6160.

    Utah County Loan to Own Program

    Utah County’s Loan to Own program provides down payment assistance to moderate-income first-time homebuyers in the form of a 0% interest, deferred-payment second loan. The loan must be repaid if the owner vacates or sells the property, and there is a $5,000 penalty if the owner does so within two years of closing.

    This program is available countywide except for Eagle Mountain, Alpine, Fairfield, and Provo. Buyers must contribute $1,000 of their own money toward the down payment. Income limits, asset limits, credit requirements, and purchase price limits apply. You can get more information at the program’s web page or call 801-852-6400.

    How to Apply to Utah Programs for First-Time Homebuyers

    Follow the links under each program to find an approved lender or other contact.

    Recommended: Understanding Mortgage Basics

    Federal Programs for First-Time Homebuyers

    Several federal government programs are designed for people who have low credit scores or limited cash for a down payment. Although most of these programs are available to repeat homeowners, like state programs, they can be especially helpful to people who are buying a first home or who haven’t owned a home in several years.

    The mortgages are generally for single-family homes, two- to four-unit properties that will be owner occupied, approved condos, townhomes, planned unit developments, and some manufactured homes.

    Federal Housing Administration (FHA) Loans

    The FHA, which is part of the U.S. Department of Housing and Urban Development (HUD), insures mortgages for borrowers with lower credit scores. Homebuyers choose from a list of approved lenders that participate in the FHA loan program. Loans have competitive interest rates and require a down payment of 3.5% of the purchase price for borrowers, who typically need FICO® credit scores of 580 or higher. Those with scores as low as 500 must put at least 10% down.

    In addition to examining your credit score, lenders will look at your debt-to-income ratio (DTI, your monthly debt payments compared with your monthly gross income). FHA loans allow a DTI ratio of up to 50% in some cases, vs. a typical 45% maximum for a conventional loan.

    Gift money for the down payment is allowed from certain donors and will be documented in a gift letter for the mortgage.

    FHA loans always require mortgage insurance: a 1.75% upfront fee and annual premiums for the life of the loan, unless you make a down payment of at least 10%, which allows the removal of mortgage insurance after 11 years. For a $300,000 mortgage balance, upfront MIP would be around $5,250 and monthly MIP, at a rate of 0.55%, would be around $137. You can learn more about these loans, including FHA loans for refinance and rehab of properties, by reading up on FHA requirements, loan limits, and rates.

    Freddie Mac Home Possible Mortgages

    Very low- and low-income borrowers may make a 3% down payment on a Home Possible® mortgage. These loans allow various sources for down payments, including co-borrowers, family gifts, employer assistance, secondary financing, and sweat equity.

    The Home Possible mortgage is for buyers who have a credit score of at least 660.

    Once you pay 20% of your loan, the Home Possible mortgage insurance will be canceled, which will lower your mortgage payments.

    Fannie Mae HomeReady Mortgages

    Fannie Mae HomeReady® Mortgages allow down payments as low as 3% for low-income borrowers. Applicants generally need a credit score of at least 620; pricing may be better for credit scores of 680 and above. Like the Freddie Mac program, HomeReady loans allow flexibility for down payment financing, such as gifts and grants.

    For income limits, a comparison to an FHA loan, and other information, go to this Fannie Mae site .

    Fannie Mae Standard 97 LTV Loan

    The conventional 97 LTV loan is for first-time homebuyers of any income level who have a credit score of at least 620 and meet debt-to-income criteria. The 97% loan-to-value mortgage requires 3% down. Borrowers can get down payment and closing cost assistance from third-party sources.

    Department of Veterans Affairs (VA) Loans

    Active-duty members of the military, veterans, and eligible family members may apply for loans backed by the Department of Veterans Affairs. VA loans, which can be used to buy, build, or improve homes, have lower interest rates than most other mortgages and don’t require a down payment. Most borrowers pay a one-time funding fee that can be rolled into the mortgage.

    Another benefit of VA loans is that they do not require private mortgage insurance (PMI) for borrowers who make a down payment of less than 20%. And they have more flexible credit score requirements. In some cases, even those who have previously been in foreclosure or bankruptcy can qualify.

    Borrowers applying for a VA loan will need a Certificate of Eligibility from the VA so make sure to review a guide to qualifying for a VA loan as a first step in the process.

    Native American Veteran Direct Loans (NADLs)

    Eligible Native American veterans and their spouses may use these no-down-payment loans to buy, improve, or build a home on federal trust land. Unlike VA loans listed above, the Department of Veterans Affairs is the mortgage lender on NADLs. The VA requires no mortgage insurance, but it does charge a funding fee.

    US Department of Agriculture (USDA) Loans

    No down payment is required on these loans to moderate-income borrowers that are guaranteed by the USDA in specified rural areas. Borrowers pay an upfront guarantee fee and an annual fee that serves as mortgage insurance.

    The USDA also directly issues loans to low- and very low-income people. For loan basics and income and property eligibility, head to this USDA site .

    HUD Good Neighbor Next Door Program

    This program helps police officers, firefighters, emergency medical technicians, and teachers qualify for mortgages in the areas they serve. Borrowers can receive 50% off a home in what HUD calls a “revitalization area.” They must live in the home for at least three years.

    First-Time Homebuyer Stats for 2022

    Ever wonder where you fit amid the mix of buyers who are out there shopping for their first home or first in a while? Here are some stats from a recent National Association of Realtors® Profile of Home Buyers and Sellers:

    Percentage of buyers nationwide who are first-time buyers: 34%

    Percentage of buyers in the NAR’s West region who are first-time buyers: 34%

    Median household income of first-time buyers nationwide: $86,500

    Type of home purchased by first-time buyers nationwide:

    •  Detached single-family home: 80%

    •  Townhouse/rowhouse: 9%

    •  Condo/apartment (five or more units): 1%

    •  Duplex/condo/apartment (two to four units: 2%

    •  Other: 8%

    Median home price for first-time buyers nationwide: $252,000

    Median down payment for first-time buyers nationwide: 7%

    Median age of first-time buyers nationwide: 33

    Relationship status of first-time buyers nationwide:

    •  Married: 50%

    •  Single females: 20%

    •  Unmarried couples: 17%

    •  Single males: 11%

    First-time buyers with kids nationwide:

    •  No children: 70%

    •  One child: 15%

    •  Two children: 11%

    •  Three or more children: 5%

    Additional Financing Tips for First-Time Homebuyers

    In addition to federal and state government-sponsored lending programs, there are other financial strategies that may help you become a homeowner. Some examples:

    •  Traditional IRA withdrawals. The IRS allows qualifying first-time homebuyers a one-time, penalty-free withdrawal of up to $10,000 from their IRA if the money is used to buy, build, or rebuild a home. The IRS considers anyone who has not owned a primary residence in the past three years a first-time homebuyer. You will still owe income tax on the IRA withdrawal. If you’re married and your spouse has an IRA, they may also make a penalty-free withdrawal of $10,000 to purchase a home. The downside, of course, is that large withdrawals may jeopardize your retirement savings.

    •  Roth IRA withdrawals. Because Roth IRA contributions are made with after-tax money, the IRS allows tax- and penalty-free withdrawals of contributions for any reason as long as you’ve held the account for five years. You may also withdraw up to $10,000 in earnings from your Roth IRA without paying taxes or penalties if you are a qualifying first-time homebuyer and you have had the account for five years. With accounts held for less than five years, homebuyers will pay income tax on earnings withdrawn.

    •  401(k) loans. If your employer allows borrowing from the 401(k) plan that it sponsors, you may consider taking a loan against the 401(k) account to help finance your home purchase. With most plans, you can borrow up to 50% of your 401(k) balance, up to $50,000, without incurring taxes or penalties. You pay interest on the loan, which is paid into your 401(k) account. You usually have to pay back the loan within five years, but if you’re using the money to buy a house, you may have up to 15 years to repay.

    •  State and local down payment assistance programs. Usually offered at the regional or county level, these programs provide flexible second mortgages for first-time buyers looking into how to afford a down payment.

    •  The mortgage credit certificate program. First-time homeowners and those who buy in targeted areas can claim a portion of their mortgage interest as a tax credit, up to $2,000. Any additional interest paid can still be used as an itemized deduction. To qualify for the credit, you must be a first-time homebuyer, live in the home, and meet income and purchase price requirements, which vary by state. If you refinance, the credit disappears, and if you sell the house before nine years, you may have to pay some of the tax credit back. There are fees associated with applying for and receiving the mortgage credit certificate that vary by state. Often the savings from the lifetime of the credit can outweigh these fees.

    •  Your employer. Your employer may offer access to lower-cost lenders and real estate agents in your area, as well as home buying education courses.

    •  Your lender. Always ask your lender about any first-time homebuyer grant or down payment assistance programs available from government, nonprofit, and community organizations in your area.

    The Takeaway

    Utah has a stream of state and local assistance for low- to moderate-income first-time homebuyers. Other first-time buyers may find a good choice among the vast landscape of mortgages on their own.

    Make your dream of being a homeowner come true with SoFi’s competitive mortgage rates and down payments as low as 3% to 5% for qualifying first-time homebuyers.

    View your rate


    Should I take first-time homebuyer classes?

    Yes! Good information is key to a successful home-buying experience for anyone, but especially for newcomers, who can easily be overwhelmed by the jargon, technicalities, and magnitude of applying for a mortgage and purchasing a home. First-time homebuyer classes can help. Indeed they are required for many government-sponsored loan programs.

    Do first-time homebuyers with bad credit qualify for homeownership assistance?

    Often they do. Many government and nonprofit homeowner assistance programs are available to people with low credit scores. And often, interest rates and other loan pricing are competitive with those of loans available to borrowers with higher credit scores. That said, almost any lending program has credit qualifications.

    What credit score do I need for first-time homebuyer assistance in Utah?

    Utah Housing’s credit score requirements range from 620 to 660, but requirements for other programs vary, and some may use criteria other than credit scores to determine a borrower’s eligibility. You can check with the organization or lender offering first-time homebuyer assistance to get specific financial requirements.

    Is there a first-time veteran homebuyer assistance program in Utah?

    Utah Housing offers a first-time homebuyer grant program that’s specifically for veterans.

    Then there are VA loans, available nationwide to eligible service members, veterans, and eligible surviving spouses.

    What is the average age of first-time homebuyers?

    The median age is 33, according to the National Association of Realtors.

    Photo credit: iStock/DenisTangneyJr

    *SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

    †Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.

    ¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.

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