Utah First-Time Home Buyer Programs of 2021

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Utah Housing Corp. offers mortgages and down payment assistance to help first-time home buyers achieve homeownership in the Beehive State.

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You may qualify as a first-time home buyer if you haven't owned a home in the past three years. Utah Housing offers loans and down payment assistance to repeat home buyers, too.

National first-time home buyer programs to consider

These national programs can help home buyers in Utah and elsewhere get mortgages with low down payments or even no down payment. Saving up for a down payment is a challenge for many first-time buyers.

Conventional mortgage

Best for:

Low down payments, limited mortgage insurance premiums

What you need to know:

A conventional mortgage is a home loan that isn’t guaranteed or insured by the federal government. Conventional mortgages that conform to the requirements set forth by Fannie Mae and Freddie Mac allow down payments as low as 3% for first-time buyers or lower-income home buyers. Unlike FHA loans, conventional loans allow borrowers to eventually cancel their mortgage insurance or avoid mortgage insurance altogether if they put at least 20% down.

VA loans

Best for:

Military, low down payments

What you need to know:

The U.S. Department of Veterans Affairs helps service members, veterans and surviving spouses buy homes. VA loans are especially generous, providing competitive interest rates, often requiring no down payment or mortgage insurance. Although there is no official minimum credit score, most VA-approved lenders require scores of at least 640.

FHA loans

Best for:

Low credit score, low down payments

What you need to know:

This is the go-to program for many first-time home buyers with lower credit scores. The Federal Housing Administration allows down payments as low as 3.5% for those with credit scores of 580 or higher. The FHA will insure loans for borrowers with scores as low as 500 but requires a 10% down payment for a score that low. Mortgage insurance is required for the life of an FHA loan and cannot be canceled.

USDA loans

Best for:

Low down payments, rural

What you need to know:

A USDA home loan is a zero-down-payment mortgage for eligible rural and suburban home buyers. USDA loans are issued by the U.S. Department of Agriculture through the USDA Rural Development Guaranteed Housing Loan Program. There are income limitations, which vary by region. Applicants with credit scores of 640 or higher receive streamlined processing. Those with scores below that must meet more stringent underwriting standards.

Utah Housing highlights and eligibility requirements

First-time home buyers in Utah who meet income and other eligibility requirements can get 30-year mortgages at competitive interest rates through Utah Housing's FirstHome Loan program. Other loan programs are available to first-time and repeat buyers.

HIGHLIGHTS

  • Down payment and closing-cost assistance is available in the form of a second mortgage.

  • All primary mortgages are 30-year, fixed-rate loans.

  • Minimum credit scores start at 620.

ELIGIBILITY

  • Loan must be used to buy a primary residence in Utah.

  • Most programs have income limits.

  • Some programs have home-price limits.

Utah first-time home buyer loan programs

FirstHome Loan

Best for:

Low down payment, down payment assistance, closing cost assistance

What you need to know:

The FirstHome Loan program offers mortgages for first-time home buyers and qualified veterans and single parents. Loans can be used for manufactured homes, with certain restrictions. The minimum credit score is 660 and there are limits on household income and purchase price.

In addition to getting Utah Housing’s lowest rates, FirstHome buyers may apply for down payment and closing cost assistance in the form of a second mortgage. Buyers may borrow up to 6% of the loan amount to pay for down payment and closing costs. The interest rate on this second loan is two percentage points higher than the primary mortgage's rate. A homebuyer education class is recommended, but it is not required.

HomeAgain Loan

Best for:

Low down payment, down payment assistance, closing cost assistance

What you need to know:

The HomeAgain Loan offers affordable interest rates on mortgages for first-time and repeat home buyers. The minimum credit score is 660. HomeAgain is similar to the FirstHome program, but may carry higher interest rates (you can check current rates on the Utah Housing website home page). HomeAgain also has higher income limits.

For help paying the down payment and closing costs, buyers using HomeAgain may get a second mortgage for up to 6% of the primary mortgage amount. The interest rate on the second loan is two percentage points higher than on the primary mortgage. A homebuyer education class is recommended, but it is not required.

Score Loan

Best for:

Low credit score, low down payment, down payment assistance, closing cost assistance

What you need to know:

The Score Loan is a mortgage for people with credit scores lower than the 660 minimum required by FirstHome and HomeAgain. It is for first-time and repeat home buyers with a minimum credit score of 620. Borrowers are required to take a home buyer education course.

Score Loans are for low- to moderate-income borrowers and there are income and home price limits. Down payment and closing cost assistance is available as a second mortgage for up to 4% of the amount of the primary mortgage. The interest rate on the second loan is two percentage points higher than on the primary mortgage.

NoMI Loan

Best for:

Low down payment, low mortgage insurance, down payment assistance, closing cost assistance

What you need to know:

The NoMI Loan is a mortgage without monthly mortgage insurance payments. It's for first-time and repeat home buyers. The minimum credit score is 700, and there are income and sales price limits. Down payment and closing cost assistance may be available as a second mortgage.

Your next step

That's a summary of homebuying programs for first-time (and repeat) home buyers in Utah. For details, see the Utah Housing Corp. website. Utah Housing does not lend directly; approved participating lenders do. If any of these programs seem promising to you, contact a lender directly.

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