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Chances are you or someone you know has been looking for full-time work for months, and the job market is feeling pretty brutal. Maybe you have friends who have been unemployed for even longer — or who are scraping by on temporary, low-wage gigs.
Meanwhile, the government continues to report a historically low U.S. unemployment rate, a sign of a resilient economy, according to many analysts.
So what gives?
To start, the national average obscures any variations by industry, location, ethnicity or age. Plus, most government reports have yet to capture the full impact of recent federal spending cuts and policy changes, according to economists at the Indeed Hiring Lab.
But there’s also more than one way to look at the nation’s unemployment picture.
One alternate measure — calculated by the Ludwig Institute for Shared Economic Prosperity — is over 24% and on the rise. This so-called “True Rate of Unemployment” still relies on government data, but also includes people who are working part-time but want full-time work as well as those who earn a poverty wage of less than $25,000 a year.
The parameters are subjective, but provide meaningful context to the struggle many Americans feel despite what’s being reported as a relatively strong job market. It may also help explain how consumer confidence got so low.
In fact, a new metric LISEP introduced last month — the Minimal Quality of Life Index — suggests a similar disconnect between standard economic indicators and what many people are experiencing.
According to LISEP, this index shows that the cost of “basic economic security” doubled between 2001 and 2023 as the price of things like housing, healthcare and college surged. That’s 38% faster than the government’s Consumer Price Index.
“For too long, traditional cost-of-living measures have fixated on mere survival, overlooking the fundamental truth that surviving is not living,” Gene Ludwig, founder of the non-profit research group, said in a statement last week.
So what? It’s true: Surviving isn’t living. And many Americans aren’t earning what they need to feel financially secure, regardless of the headlines. But what you make isn’t the only variable in your financial equation, and it doesn’t have to define your situation. Adopting a take-charge attitude can make a big difference.
Here are a few simple ideas to get you started:
• Even when your budget is tight, there’s usually some room to save money, whether it’s wasting less food, avoiding unnecessary bank fees, or downgrading your phone or Internet plan.
• If you’re straining to pay your credit card bill or car payment, reach out to your lenders. You may be able to negotiate a lower payment or get a temporary reprieve.
• If your insurance or utility bills have been rising, be proactive. Call the companies to see if they can offer you a better deal or shop around with other providers.
• There are always options. Don’t hesitate to seek help, whether that means asking a mentor to connect you to job opportunities, getting expert advice on lowering your debt burden, or using a financial planner to get a clearer handle on the big picture. (SoFi can help with this last one. Members can get a complimentary 30-minute initial consultation.)
• 5 Things to Do to Come Back From a Layoff (SoFi)
• How to Land a New Job in a ‘Low Firing, Low Hiring’ Market (CNBC)
• New College Grads are Entering a Workforce Shaped by Chaos. Here’s How They’re Preparing (Quartz)
Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
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(Last Updated – 06/2025)
Are you a first-time homebuyer in Connecticut? You’re looking at a tough market in the Constitution State. In April 2025, home prices in Connecticut were up 7.6% year-over-year. The median price of a Nutmeg State home is $451,100, according to Redfin. This home-buying guide was crafted to help first-time homebuyers. But hey, that raises a question…
A first-time homebuyer is someone who has either never owned a home or hasn’t owned one in the past three years.
At the national level, the U.S. Department of Housing and Urban Development (HUD) definition includes:
• A single parent who has only owned a home with a partner while married
• A displaced homemaker who has only owned a home with a spouse
• Someone who has owned a principal residence not permanently affixed to a permanent foundation
• Someone who has only owned a property that wasn’t in compliance with state, local, or model building codes and that would cost more to fix than building a new home
Veterans and people who buy in targeted areas often qualify for the same state and county home mortgage loan perks that first-time buyers do. If you aren’t sure what area you want to live in just yet, check out a list of the best affordable cities in Connecticut.
Recommended: First-Time Homebuyer Guide
The Connecticut Housing Finance Authority leads the way in offering mortgages and down payment assistance to low- and moderate-income buyers.
Here are the programs.
Connecticut Housing Finance Authority mortgages with below-market interest rates can be paired with down payment assistance for those who qualify. Borrowers must be first-time homebuyers or purchasing in a targeted area. There are home price and income limits .
Borrowers must attend a free homebuyer education course, which will explain the home-buying process and mortgage basics.
This program for first-time buyers and people purchasing in a targeted area provides mortgage loans with lower monthly mortgage insurance costs. And mortgage insurance premiums end when the borrower reaches 20% equity.
You must meet sale price and income limits (see this chart).
Connecticut Housing offers benefits to active-duty military members, veterans, and surviving spouses who meet purchase price and income limits. The agency has a similar program for teachers and police officers .
Another mortgage and down payment program is for applicants who are disabled or who have a disabled member of the household.
This very low-rate second mortgage program provides a loan of up to $15,000 at an attractive rate to help with a down payment or closing costs.
Borrowers must apply and qualify for a Connecticut Housing mortgage with a participating lender and demonstrate the ability to repay that mortgage and the second loan to qualify.
This program provides 0.00% interest loans with no monthly payment required. Each year, 10% of the balance will be forgiven until the loan is fully forgiven in 10 years. The loan amounts are as follows:
• Homes in high- or very high-opportunity areas : up to $50,000
• Homes in other areas: up to $25,000
Borrowers must qualify and receive a Connecticut Housing mortgage, and must have been a resident of Connecticut for at least the preceding three years.
The Time to Own loan may be used with other down payment assistance programs.
The Housing Development Fund (HDF) offers down payment assistance to qualified first-time homebuyers (the applicant and any non-borrowing spouse must be first-time buyers). With the CT Forever program, first-time homebuyers can borrow up to $28,000 in down payment assistance at 1.00%. (If they sell within 10 years of purchase, the price must be affordable to homebuyers.) The Live Where You Work program offers first-time homebuyers up to $25,000 in down payment and closing cost assistance at 0.00% interest if they are buying a home in the town where they work. The SmartMove Homeownership second mortgage charges 3.00% on a loan for up to 25% of the home’s purchase price to help with down payment and qualified closing costs.
To be eligible, you must have not had a bankruptcy in the past four years or a foreclosure in the past seven years. You must have funds available to cover at least 1% of the purchase price, pre-closing costs, and emergency reserves, and be able to demonstrate a steady work history and on-time bill payment.
Some cities also offer homeownership help. You might want to look into your city of choice and consult the list compiled by the CHFA.
To apply for a mortgage offered by the Connecticut Housing Finance Authority, contact one or more participating lenders .
To apply for Housing Development Fund down payment assistance, create an account and upload documents.
Do you know how much you can afford to pay for a house? This home affordability calculator could help.
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.
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 57% 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.
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 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 .
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.
Eligible active-duty members of the military, veterans, reservists, and surviving spouses 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.
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.
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 .
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. For more information, visit the HUD program page.
• Median home sale price in Connecticut: $451,500
• 3% down payment: $13,545
• 20% down payment: $90,300
• Percentage of buyers nationwide who are first-time buyers: 24%
• Median age of first-time homebuyers: 38
• Average credit score (vs. average U.S. score of 715): 726
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 two 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, in a year 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 longer 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.
Finally, this home affordability calculator can show you how much you can afford to spend on a home.
First-time homebuyers in Connecticut may be able to take advantage of attractive home loan and down payment assistance options. Those who don’t fit within the parameters may be able to find good mortgage opportunities on their own.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
Yes! Newcomers 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 some government-sponsored loan programs.
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.
The Connecticut Housing Finance Authority does not offer one. Homebuyers should check with their lender or tax advisor as tax policies change periodically.
Yes. Connecticut Housing has a veterans program that offers a below-market-rate mortgage that can be paired with down payment assistance for those who qualify.
The assistance programs described specify no minimum credit scores. Lenders often determine their own minimum scores.
The U.S. median age of first-time homebuyers is 38.
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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SOHL-Q225-214
By Kenny Zhu
(Last Updated – 06/2025)
If you’re thinking of buying a home in Delaware, you will likely be interested in knowing that for qualified buyers, there can be help with your down payment, mortgage, and closing costs.
Owning a home in Delaware can be somewhat more expensive than the national average. The current home value is, on average, $402,409 (up 2.0% year over year) versus the national average of $367,741.
If you are of lower or middle income, however, the Delaware State Housing Authority offers a number of homebuyer assistance programs that can help you make ends meet. The help comes in the form of home loans, down payment assistance, and tax credits. There are also other programs at the federal level that may help you purchase a property. Read on for the details.
The Delaware State Housing Authority (DSHA) offers homebuyer assistance programs to encourage homeownership across the First State.
The programs are for both first-time homebuyers — generally people who have not owned a principal residence in the past three years — and repeat homebuyers.
Some have qualifying income or location requirements. You’ll also need to ensure that you’re obtaining your mortgage through a participating DSHA-approved lender in order to be eligible for any of the benefits.
DSHA offers 30-year fixed-rate mortgages through conventional, FHA, VA, and USDA loan programs for first-time and repeat homebuyers alike. The mortgages may be underwritten at rates that are either at or below market, helping homebuyers afford a house.
The “Welcome Home” program includes:
• Smart Start First Mortgage: Unassisted first mortgage.
• First State Home Loan: 3% of the final loan amount for down payment and closing costs.
• Diamond in the Rough: 5% of the final loan amount for down payment and closing costs. Available only to homebuyers who qualify for the FHA 203(k) Limited Program.
Under its “Home Again” program, the DSHA also offers Smart Start and First State Home Loans to homebuyers (first-time and repeat) who exceed the income limits for “Welcome Home.”
Learn more about these programs on the DSHA site .
The state of Delaware allows eligible first-time homebuyers to claim up to 35% of their annual mortgage interest paid in the form of a federal tax credit of up to $2,000 a year.
Like some of the programs above, the mortgage credit certificate typically requires you to qualify as a first-time homebuyer.
You can learn more on the DSHA website .
💡 Quick Tip: Don’t overpay for your mortgage. Get your dream home or investment property and a competitive rate with SoFi Mortgage Loans.
The Department of Housing and Urban Development (HUD) defines a first-time homebuyer as someone who hasn’t owned a principal residence within the past three years (including a spouse), a single parent (who may have owned a house with a former spouse), and a displaced homemaker who has only owned a house with a spouse.
Remember that those who aren’t first-time homebuyers may still qualify for homebuyer loans and down payment assistance through the DSHA. Make sure to check the specific requirements of your program to confirm.
Recommended: Guide for First-Time Homebuyers
To qualify for one of DSHA’s Homeownership Loans, you’ll need to apply through a participating lender and meet all of the income, credit, and target location requirements.
To qualify for DSHA homebuyer benefits, you’ll need to have a credit score of 620 or higher and an annual household income at or below the limits set by the DHSA.
Qualifying first-time homebuyers often also need to complete a housing counseling course.
To obtain DSHA homebuyer benefits, you will need to apply for a mortgage directly through a lender that participates in the program. This applies regardless of whether you’re trying to obtain a conventional, VA, USDA, or FHA home loan.
Participating DSHA lenders can be found on the DSHA website, as noted above.
Keep in mind that even though you may qualify under the housing authority’s minimum requirements, a lender may issue its own set of underwriting requirements.
Once you submit an offer that’s accepted by the seller, you’ll need to contact your lender directly and provide the details of the property you wish to purchase so the lender can complete the underwriting process.
It’s essential that you remain responsive during this stage of the process to ensure that everything goes according to plan. Your loan officer will coordinate with you and your real estate agent to confirm an appropriate closing date, ensure that all necessary reviews are completed, and validate your DSHA benefits.
It can typically take from 30 to 45 days from the time your offer is accepted to closing day. The timeline may vary, though, based on the complexity of your deal.
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.
The FHA, which is part of the U.S. Department of Housing and Urban Development (HUD), insures mortgages for borrowers with lower credit scores. Here’s more about how the program works:
• 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 low credit scores, in the range of 500 to 579, 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 57% in some cases, vs. a typical 45% to 50% 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.
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.
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 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 .
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.
Unlike an FHA loan, the 97 LTV loan has no upfront mortgage insurance fee and does have cancellable mortgage insurance. The loan is for just one-unit single-family homes, co-ops, condos, and planned unit developments.
Eligible active-duty members of the military, veterans, reservists, and surviving spouses 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.
• VA loans do not require private mortgage insurance (PMI) for borrowers who make a down payment of less than 20%.
• VA loans can 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.
💡 Quick Tip: Active duty service members who have served for at least 90 consecutive days are eligible for a VA loan. But so are many veterans, surviving spouses, and National Guard and Reserves members. It’s worth exploring with an online VA loan application because the low interest rates and other advantages of this loan can’t be beat.†
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. While the VA doesn’t require mortgage insurance, it does charge a funding fee. For more details, contact [email protected].
No down payment is required on these loans that are guaranteed by the Department of Agriculture in specified areas. Borrowers must meet USDA income requirements, and will 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 borrowers. For loan basics and income and property eligibility, head to this USDA site .
If you are a police officer, firefighter, emergency medical technician, or teachers, you may qualify for these mortgages in the areas you 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.
Here are some stats about home buying in Delaware:
• Median home sales price in Delaware: $359,900
• 3% down payment: $10,797
• 20% down payment: $71,980
• Average credit score in Delaware: 714
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 two 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 can 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 if 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 you to borrow from a 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, in a 12-month period 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 longer 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, but you may want to do the math to be sure.
• 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.
Qualified first-time homebuyers in Delaware can leverage homebuyer assistance programs to help with the down payment, mortgage, and closing costs. These may be offered by the state or the federal government and can make homeownership more affordable. It’s also worthwhile to compare what these and offers from other lenders to find the right fit for your situation.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
You will likely learn good information, which can be key to a successful home-buying experience, especially for newcomers. Plus, these are required for some government-sponsored loan programs. Check with your lender, real estate agent, and local housing advocacy groups for programs in your area.
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 loan will have credit qualifications. That’s why it’s important to take all possible steps to improve your credit standing before you go house hunting.
Yes, Delaware allows first-time homebuyers to claim a tax credit of up to 35% of their annual mortgage interest, up to a $2,000 per year, reducing taxes owed.
First-time veteran homebuyers qualify for the same homebuyer assistance programs as other first-time homebuyers in Delaware. The DSHA does allow VA loans to be issued directly through its loan program. This allows veterans to take advantage of both first-time homebuyer and VA benefits.
The minimum credit score required for applicants to DSHA’s “Welcome Home” loans is 620.
A state-specific age is hard to pinpoint, but the average age of a first-time homebuyer in the United States is 38.
Photo credit: iStock/DenisTangneyJr
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*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.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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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.
†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.
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