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New York State First-Time Home Buyer Programs of 2018

July 30, 2018
Finding the Right Mortgage, Mortgages
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The State of New York Mortgage Agency offers special programs to qualified first-time home buyers who want to purchase property in-state. If you haven’t owned a primary residence during the past three years, SONYMA considers you a first-time home buyer.

National first-time home buyer programs

You don’t have to be an Empire State resident to access these national programs. They are a good first step before you drill down to state-sanctioned initiatives.

Conventional mortgage

National program

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,

 

FHA loans

National program

Best for

Low credit score

Low down payment

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

 

VA loans

National program

Best for

Military

Low down payment

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

 

USDA loans

National program

Best for

Low down payment

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

 

» MORE: Tips for first-time home buyers

New York state first-time home buyer programs

These programs are offered to New York state first-time home buyers. However, the first-time buyer requirement is waived if you are a U.S. military veteran applying to purchase a home or you’re buying a home in a federally designated “target area” — an economically disadvantaged neighborhood where homeownership may provide a boost to the local quality of life.

SONYMA highlights and eligibility requirements

Highlights

  • There is no credit score requirement for mortgage programs.
  • Nontraditional credit is considered for some programs.
  • Mortgage insurance is required on loan-to-value >80%.
  • Down payment assistance is offered.

Eligibility

  • Borrowers must have a minimum of three lines of credit that have been active for at least 18 of the past 24 months — and paid on time.
  • Overall debt-to-income ratio of 45% or less.
  • Must meet county limits on household income and purchase price.
  • Maximum LTV of 97% for single-family homes.
  • Two-year employment history.
  • Borrower contribution of at least 1% on LTV >95%.
  • Attend a home buyer education course.

Achieving the Dream

State program

Best for

Low-income borrowers

Low down payment

Low mortgage rates

What you need to know

The Achieving the Dream program is offered to lower-income, first-time home buyer applicants. Borrowers will receive reduced interest rates and a lower down payment requirement on a 30-year loan. The mortgage can finance the purchase and renovation of a one- or two-unit home, and there are also

 

Conventional Plus Program

State program

Best for

Down payment assistance

Closing cost assistance

What you need to know

This loan wraps a lot of features into one program. It’s the Swiss army knife of mortgage assistance: Take a 30-year loan for purchase or refinance, throw in down payment assistance, and offer it to first-time home buyers or existing homeowners. And that’s just the start. The Conventional Plus

 

Low Interest Rate Program

State program

Best for

Low-income borrowers

Low mortgage rates

What you need to know

Low-to-moderate-income home buyers get a favorable interest rate in SONYMA’s Low Interest Rate Program — though published rates for the Achieving the Dream Program are even lower.

 

Down Payment Assistance Loans

State program

Best for

Down payment assistance

What you need to know

A down payment assistance loan can be combined with any SONYMA mortgage program. It’s structured as a second mortgage, but there are no monthly payments required, and interest is not charged. In fact, the loans are forgiven after 10 years if borrowers maintain their primary SONYMA financing, and

 

Homes for Veterans Program

State program

Best for

Military

What you need to know

This program aims to help veterans and active-duty U.S. military personnel buy a home, even if it’s not their first. The loans offer favorable terms, and down payment assistance is available. Military-affiliated borrowers don’t have to meet first-time buyer requirements and generally get a break on

 

RemodelNY

State program

Best for

Home improvements

What you need to know

RemodelNY is a purchase and renovation mortgage rolled into one. Whether you have your eye on a fixer-upper or a home that simply needs a few upgrades, this SONYMA 30-year loan may be just what you need to enhance that home’s curb — and family — appeal.

 

Energy Star Labeled Homes Program

State program

Best for

Energy-efficient improvements

What you need to know

If you’re buying new construction or building a home, this program allows you to install energy-efficient upgrades. This can include windows, insulation, appliances, lighting, and heating and cooling systems.

 

FHA Plus Program

State program

Best for

Low mortgage insurance

Government-backed loans

What you need to know

Available for new home buyers or existing homeowners, the FHA Plus Program incorporates SONYMA’s down payment assistance with an FHA-backed mortgage. This can help you reduce the mortgage insurance premium you pay on an FHA loan.

 

Graduate to Homeownership Program

State program

Best for

Recent college graduates

What you need to know

An innovative program geared to recent college graduates, SONYMA provides down payment assistance, favorable interest-rate loans and homebuying education to prospective borrowers. A unique qualifier: Applicants must be looking to buy their first home in specified New York communities slated for

 

Neighborhood Revitalization Program

State program

Best for

Home improvements

What you need to know

A major priority for New York state’s home buyer initiatives is to improve neighborhoods and revitalize communities. The Neighborhood Revitalization Program offers cash and financing assistance for prospective homeowners to buy and renovate vacant homes. The properties can include one- to

 

Your next step

Remember, the lender you work with may have additional borrower requirements than those stated in any SONYMA assistance program. They may include credit score minimums or other credit qualifications. So, dig into the programs you’re interested in, learn all you can, then talk to a few lenders about the possibilities.

For full details on any SONYMA program, visit the SONYMA website.

To find participating lenders, search the SONYMA lender list.

» MORE: See the best New York mortgage lenders

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