By Walecia Konrad

(Last Updated – 03/2024)

Georgia, one of the fast-growing Southeastern states, saw its median sale price rise to $362,900 in February 2024, up 6.5% over the same period the previous year, according to real estate firm Redfin. The number of homes sold fell 1.4% during the same period.

Georgia still shows signs of a competitive market, with an average of one in five homes selling above list price. First-time buyers might feel intimidated, but help awaits those who qualify.

3 Georgia Programs for First-Time Homebuyers

The Georgia Department of Community Affairs oversees a busy first-time homebuyer program. And several areas of Georgia, especially Atlanta, the state capital and largest city, offer extensive assistance for low- and moderate-income buyers.

1. Georgia Dream

The Georgia Dream homeownership program offers a 30-year fixed-rate conventional loan or government-backed FHA, USDA, or VA loan with competitive interest rates available to first-time buyers.

Buyers must meet certain income and purchase price limits . Borrowers must also contribute at least $1,000 of their own funds toward the home purchase, but they may not have more than $20,000 or 20% of the home purchase price (whichever is greater) in liquid assets.

A FICO^® credit score of 640 or above is required. So is the completion of a homebuyer education course or counseling session, which can help buyers understand how much mortgage they can afford.

2. Georgia Dream Down Payment Assistance

The Georgia Dream mortgage loans can be paired with first-time homebuyer down payment assistance up to $10,000. This second loan is zero interest with no monthly payments. It’s due upon sale of the house or refinance of the first mortgage.

Some people, including public servants such as protectors, educators or health care professionals, active-duty military members, and buyers with a family member who is disabled, may qualify for as much as $12,500 in down payment assistance.

3. Local First-Time Homebuyer Assistance

Atlanta, Macon, and Savannah all have active homeownership assistance programs. Invest Atlanta , for instance, offers several down payment assistance programs in several areas of the city.

Be sure to check with the city, county, and local community and home advocate organizations for additional resources for first-time buyers.

Recommended: Understanding the Different Types of Mortgage Loans

How to Apply to Georgia Programs for First-Time Homebuyers

The Georgia Department of Community Affairs website offers a complete description of the Georgia Dream program. It is not a lender but it does list participating lenders throughout the state. It also provides contact information for homebuyer education classes and counseling, which is required for all Georgia Dream applicants.

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 checking 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.

Georgia First-Time Homebuyer Stats for 2024

Here is a snapshot of the recent Georgia home buying experience.

•  Median home sale price in Georgia: $362,900

•  3% down payment: $10,887

•  20% down payment: $72,580

•  Percentage of buyers nationwide who are first-time buyers: 32%

•  Median age of first-time homebuyers: 35

•   Average credit score (vs. average U.S. score of 714): 695

•   Georgia cost of living: Fifth lowest in the country

Who Is Considered a First-Time Homebuyer in New Mexico?

The New Mexico Mortgage Finance Authority and the federal government consider anyone who has not owned a principal home in the past three years a first-time buyer.

The agency requires all buyers to complete a homebuyer education course before the purchase. Homebuyer education classes can help buyers understand how much mortgage they can afford.

💡 Quick Tip: Want the comforts of home and to feel comfortable with your home loan? SoFi has a simple online application and a team dedicated to closing your loan on time. No surprise SoFi has been named a Top Online Lender in 2024 by LendingTree/Newsweek.

4 New Mexico Programs for First-Time Homebuyers

The New Mexico Mortgage Finance Authority, also known as the MFA, administers several types of home loans through its FirstHOME Program. The agency also offers a down payment assistance program. Here are the details..

1. MFA FirstHOME Loan

The MFA FirstHOME Loan program for first-time buyers offers an FHA, VA, USDA, or housing finance agency preferred conventional loan. It can be paired with New Mexico’s down payment assistance program.

Borrowers must have a minimum credit score of 620 (for buyers with no credit score, alternative credit qualification may be acceptable).

There are household income and purchase price limits unless the buyer is planning to purchase a home in a targeted area. Residences that may be financed include single-family detached homes, townhomes, condominiums, homes in planned unit developments, and manufactured homes that are at least doublewide and attached to a permanent foundation.

2. MFA FirstDown and FirstDown Plus Loan

This FirstDown Loan program provides a fixed-rate second mortgage loan for down payment and closing cost assistance for first-time homebuyers in New Mexico. FirstDown must be combined with the FirstHome program. The requirements are similar to FirstHome; borrowers must have a minimum credit score of 620 in most cases.

An additional helping hand may be available: FirstDown Plus provides a fixed amount of $15,000 in the form of a 10- year, non-amortizing loan with a 0% interest rate. The $15,000 must be used only for down payment, and it’s a loan, not a grant. The FirstDown Plus loan has no monthly payments and will be forgiven if the borrower continually occupies the home for a full 10-year period and follows the other loan guidelines.

3. MFA HomeNow Program

The New Mexico MFA another assistance program for first-time homeowners: The HomeNow down payment/closing cost assistance program offers a second mortgage with 0% interest and no payments and may be forgiven in 10 years for borrowers who still own and occupy their houses.

This program is available to buyers who earn less than 80% of the area median income, have a credit score of 620, and have a FirstHome mortgage. Purchase price limits also apply.

4. MFA HomeForward Program

HomeForward is another option for first-time homebuyers in New Mexico. A HomeForward First Mortgage Loan may be available to prospective borrowers who do not qualify for the FirstHome program. The HomeForward can be used with MFA’s HomeForward DPA program, a second mortgage that can cover up to 3% of the sale price. Again, a credit score of at least 620 is required.

Recommended: Understanding the Different Types of Mortgage Loans

How to Apply to New Mexico Programs for First-Time Homebuyers

The New Mexico Mortgage Finance Authority website contains more information and fact sheets on all of its first-time and repeat buyer mortgage programs and how they work with MFA’s down payment assistance.

The agency does not lend directly but does list participating lenders , making it easier to compare interest rates, fees, and other costs and learn what you qualify for.

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. Consider these details:

•   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.

•   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.

💡 Quick Tip: Backed by the Federal Housing Administration (FHA), FHA loans provide those with a fair credit score the opportunity to buy a home. They’re a great option for first-time homebuyers.¹

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

Are you an active-duty member of the military, veteran, and eligible family member? You 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. You can receive more information on these loans by contacting [email protected].

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.

New Mexico First-Time Homebuyer Stats for 2024

Here’s a snapshot of typical New Mexico home sales transactions.

•  Median home sale price: $290,781

•  3% down payment: $8,723.43

•  20% down payment: $58,156.20

•  Average credit score in New Mexico (vs. U.S. average of 714): 702

Who Is Considered a First-Time Homebuyer in Mississippi?

A person who has never owned a home, or who hasn’t owned one in the last three years, qualifies. The U.S. Department of Housing and Urban Development (HUD) also considers the following people first-time homebuyers:

•   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

Recommended: First-Time Homebuyer’s Guide

3 Mississippi Programs for First-Time Homebuyers

Here are a few of the programs available to the first-time homebuyer in Mississippi. You’ll find some low-interest mortgage loans and down payment assistance options that you may qualify for.

1. MHC: Mortgage Revenue Bond 7 (MRB7)

This program from the Mississippi Home Corporation provides $7,000 in down payment assistance to first-time homebuyers in Mississippi. This comes in the form of a 30-year fixed rate loan. The $7,000 is deferred and forgivable after 10 years. To qualify, you must meet income, purchase price and credit requirements.

2. MHC: Smart6

A 30-year fixed rate mortgage combined with a $6,000 (and 0% interest) second loan that you can use for your down payment or closing costs is offered through Smart6 . To qualify, your income cannot exceed $122,000, and you may need to have a certain credit score.

3. MHC: Housing Assistance for Teachers

If you’re a teacher working in an area where there is a shortage of educators in Mississippi, you may qualify for a special down payment loan. This program provides a 25- or 30-year fixed loan of up to $6,000.

To qualify, you must agree to serve as a teacher for three years in the designated district. And in this case, your loan can be forgiven. Also, you must provide at least 1% of the home’s sale price and one month’s reserves.

How to Apply to Mississippi Programs for First-Time Homebuyers

If you qualify for any of the programs for the first time home buyer in Mississippi, contact a participating
lender to start your application process. Also, you can use this mortgage calculator to see how much your monthly payments might be.

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.

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.

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. For more information, contact [email protected].

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. Contact the Mississippi HUD office .

Mississippi Homebuyer Stats for 2024

•   Percentage of buyers nationwide who are first-time buyers: 32%

•   Median age of first-time homebuyers: 35

•   Median home price in Mississippi: $228,300

•   20% down payment in Mississippi: $45,660

•   Average credit score in Mississippi: 680

Not sure how much home you can afford? Use this home affordability calculator to find out.

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. After reading up on how to choose a mortgage term, check out these tips on how to lower your mortgage payment:

•  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

Homes in Mississippi are selling fast, but if you’re a first-time buyer in the state, you may be able to take advantage of programs that can offer you a low-interest mortgage and assistance with down payment and closing costs.

By Kim Franke-Folstad

(Last Updated – 03/2024)

South Carolina’s beautiful coastline, historic towns, and Southern hospitality have always been a magnet for tourists. But the state is also an appealing haven for homebuyers who fall in love with its charms.

South Carolina is becoming a popular option for retirees, remote workers, and others who decide to migrate from large cities. And that can mean more competition and rising prices for first-time homebuyers in South Carolina’s seller’s market.

According to Redfin, the median statewide sales price rose to $361,900 in February 2024 — a 6.7% increase in 12 months. In some South Carolina communities, the numbers were much higher. Prices rose especially steeply in Garden City, Spartanburg, and Hilton Head Island.

Buyers in the Palmetto State may think homeownership is out of reach, but fortunately, assistance programs are offered by the state and some cities and counties. Longstanding federal programs also could improve a buyer’s chances of success.

Recommended: First-Time Homebuyer Guide

5 South Carolina Programs for First-Time Homebuyers

Most first-time homebuyer programs in South Carolina are designed to help low- to moderate-income buyers who need help coming up with a down payment and/or closing costs. Generally, that assistance comes in the form of a second home mortgage loan that is fully forgiven if the buyer stays in the home for a set amount of time (usually three years).

During that time, buyers don’t have to make a monthly payment or pay interest on the second loan. But if they sell the home before the full three years is up, they will be required to repay a portion of the assistance they received.

Participants must meet limits regarding their income, credit scores, and debt-to-income ratio. Typically, the home must be the buyer’s primary residence, and there may be limits on how much the home can cost. Also, at least one of the buyers may be required to complete a homebuyer education course.

Recommended: Understanding Mortgage Basics

Here are details about South Carolina’s homebuyer programs.

1. SC Housing Homebuyer Program

The SC Housing Homebuyer Program offers qualifying first-time buyers a 30-year, fixed-rate mortgage paired with a forgivable no-payment, 0% interest second loan to put toward a down payment, closing costs, or both for a primary home.

Participants have the option of choosing from several different types of mortgages, including FHA, VA, USDA, and conventional home loans.

Availability: Statewide (though program benefits may differ by county)

Type of Assistance: Second mortgage forgiven monthly over a 15-year term. If borrowers remain in the home for the full term, the second loan is fully forgiven.

Benefits and Qualifications Include:

•   In “non-targeted” counties, the program is for first-time homebuyers (including borrowers who haven’t owned a principal residence in three years)

•   In “targeted” counties, borrowers cannot have any ownership interest in a home at the time of closing

•   Minimum credit score of 620 or 640, depending on loan type

•   Must complete homeownership education course

To Apply: Contact an approved lender or SC Housing at [email protected].

2. SC Housing Palmetto Home Advantage

The Palmetto Home Advantage program offers qualifying first-time and repeat buyers a 30-year, fixed-rate mortgage paired with a forgivable no-payment, 0% interest second loan to put toward their down payment and/or closing costs. Participants may have the option of choosing from FHA, VA, USDA, and conventional home loans.

Availability: Statewide

Assistance Amount: 0%, 3%, or 4% of the loan amount

Type of Assistance: Second loan forgiven monthly over a 10-year term.

Benefits and Qualifications Include:

•   No first-time buyer limitations

•   Borrowers who require mortgage insurance may receive reduced rates

•   Income limit for government loans is $124,000 per borrower

•   Borrower income limit for conventional loans can’t exceed 80% of area median income

•   Minimum credit score of 640 for all loan types

To Apply:Contact an approved lender or SC Housing directly at [email protected].

3. SC Housing Palmetto Heroes

The Palmetto Heroes program benefits South Carolina teachers, law enforcement and corrections officers, firefighters, emergency medical services and health care workers, active-duty military, veterans, and members of South Carolina’s Army National Guard and Air National Guard by offering a reduced-rate first mortgage paired with $10,000 in forgivable down payment assistance through a 0% interest, no-payment second mortgage.

4. SC Housing County First Initiative

The County First Initiative is designed to help potential homebuyers in underserved communities with poor economic conditions. It offers a reduced-rate conventional, FHA, VA, or USDA first mortgage paired with a 0% interest, no-payment, forgivable second mortgage of up to $8,500 that can be used for a down payment and closing costs.

Assistance Amount: Up to $8,500 for down payment and closing costs

Type of Assistance: Second loan forgiven monthly over 10-year term. If borrowers remain in the home for the full term, the second loan is fully forgiven.

Benefits and Qualifications Include:

•   Available to first-time and repeat buyers

•   Minimum credit score is 620 or 640, depending on loan type

•   Must complete homeownership education course

Like the Homebuyer Program, income and home price limits apply.

To Apply: Contact an approved lender .

5. SC Mortgage Tax Credit Program

The SC Mortgage Tax Credit program offered by SC Housing is a different kind of assistance program designed to help low-income homebuyers. Borrowers can use a mortgage credit certificate to claim a portion of their annual mortgage interest, dollar for dollar, up to $2,000, as a federal tax credit every year for the life of their loan.

The cost of a SC Mortgage Tax Credit is $500, and participating lenders also may charge a processing fee up to $500. This cost may be paid by the borrower or by the seller.

Applicants must be first-time homebuyers (you can’t have owned a home within the past three years) unless you’re a qualified military veteran or buying in a designated area. Income and home purchase price limitations may vary by county.

To Apply: You can apply for the credit certificate when you take out a home loan through a state-approved participating lender. To get the credit, you’ll need to complete IRS Form 8396 when you file your taxes.

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City and County First-Time Buyer Programs

If you’ve already picked out the South Carolina city or county you hope to make your home, you may want to research the local buyer assistance programs that are available. Here’s the rundown on a few.

City of Charleston Homeownership Initiative First-Time Homebuyer Program

The City of Charleston partners with several agencies to assist first-time homebuyers in low- to moderate-income families. For information on the program’s benefits and eligibility requirements, check out the program’s brochure or call (843) 724-3766.

Richland County Homeownership Assistance Program

Richland County Community Development offers down payment and/or closing cost assistance to low- to moderate-income households through forgivable loans of up to $10,000. For information on the program’s benefits and eligibility requirements, go to the program’s website or contact the Ombudsman Response Center at (803) 929-6000 or [email protected].

City of Rock Hill First-Time Homebuyer Program

The Housing Development Corporation of Rock Hill provides up to $5,000 in down payment and closing cost assistance to eligible homebuyers through a forgivable second mortgage.