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Ohio First-Time Home Buyer Programs of 2018

July 30, 2018
Finding the Right Mortgage, Mortgages
Ohio First-Time Homebuyer Programs
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If you are a first-time home buyer in Ohio, there’s help to make home-owning more affordable. The state of Ohio works with mortgage companies, lenders and credit unions to offer home loans to people with low and moderate incomes, including first-time home buyers. You’re considered a first-time buyer if you haven’t owned a residence within three years.

The Ohio Housing Finance Agency, or OHFA, helps with 30-year fixed-rate conventional, Federal Housing Administration, Veterans Affairs and U.S. Department of Agriculture Rural Development mortgages that have relaxed income and purchase price limits.

Here’s what to know about national and state programs available in Ohio and what you need to qualify.  

National first-time home buyer programs

These national mortgage programs may be used by first-time home buyers to make home-owning more affordable in any of the 50 states.

Conventional mortgage

National program

Best for

Low down payment

Limited mortgage insurance premiums

What you need to know

First-time home buyers can get a conventional home loan with as little as 3% down if the mortgage meets requirements set by Fannie Mae and Freddie Mac. And if you put at least 20% down, you won’t have to pay mortgage insurance. Most lenders require a minimum credit score of 620 to qualify for a

 

FHA loans

National program

Best for

Low credit score

Low down payment

What you need to know

Mortgages insured by the Federal Housing Administration, or FHA, offer relaxed qualification requirements, especially when it comes to down payment and credit score. You can qualify for an FHA home loan with a credit score as low as 500, but you’ll need a 10% down payment. If your score is 580 or

 

VA loans

National program

Best for

Military

Low down payment

What you need to know

Guaranteed by the U.S. Department of Veterans Affairs, these mortgages are available to military members, veterans and surviving spouses. If you qualify, you’ll see benefits such as no minimum credit score and no down payment or mortgage insurance, but you'll likely have to pay a VA funding fee.

 

USDA loans

National program

Best for

Low down payment

Rural

What you need to know

The USDA home loan program encourages rural and suburban homeownership by offering zero-down-payment mortgages to lower-income buyers. Borrowers with nontraditional credit data, like rent or utility payments, can still apply, but those with a score of 640 or above will experience faster loan

 

Ohio first-time home buyer loan programs

OHFA also has a number of programs that assist first-time buyers and others buying a home. Benefits include lower mortgage rates, down payment assistance, tax credits and combined financing for buying and renovating a home. Besides basic eligibility rules, each program may have additional requirements, including limits on income and maximum purchase price.

First-time buyers have several financing options through OHFA, including FHA, VA, USDA Rural Development and conventional mortgage loans with affordable 30-year fixed rates. Buyers can look up participating lenders and income and purchase-price limits. These loans, with somewhat different rules, are available to qualifying repeat buyers through the OHFA Next Home program.

OHFA highlights and eligibility requirements

HIGHLIGHTS

  • Minimum credit score 660 for non-203(k) FHA loans, 640 for others
  • Down payment assistance forgivable after seven years
  • Mortgage tax credits available
  • Incentives for recent college grads, military and helping professions

ELIGIBILITY

  • Free home buyer education required  
  • Limits on debt-to-income, purchase price and borrower incomes
  • First-time buyer requirement waived for eligible veterans
  • First-time buyer requirement waived for homes in target areas

» MORE: 25 tips for first-time home buyers

Ohio Mortgage Tax Credit

State program

Learn more

at OHFA

Best for

Tax credits

What you need to know

First-time home buyers combining an OHFA mortgage and a down payment assistance program may be eligible for a mortgage credit certificate if they meet income and purchase price guidelines. The certificate allows a tax credit of up to 40% of the borrower’s annual mortgage interest paid and can be

 

Ohio Your Choice! Down Payment Assistance

Learn more

at OFHA

Best for

Down payment assistance

What you need to know

First-time home buyers and repeat buyers may qualify for down payment assistance of either 2.5% or 5% of the home’s purchase price. The larger assistance amount comes with a higher interest rate. You can use the money toward your down payment, closing costs or other qualifying “pre-closing”

 

Ohio Heroes

State program

Learn more

at OHFA

Best for

Veterans

Military

First responders

Educators

Doctors and nurses

What you need to know

Ohio Heroes offers discounted mortgage rates to eligible first-time and repeat buyers who are members of helping professions, including veterans, active-duty military members or reservists (surviving spouses included), police, paid and volunteer firefighters, emergency medical technicians,

 

Ohio Grants for Grads

State program

Learn more

at OFHA

Best for

Recent college graduates

What you need to know

Recent graduates may be eligible for two homebuying incentives designed to keep them in Ohio after college. You’re eligible if you’re a first-time buyer and if, within the past 48 months, you earned an associate, bachelor’s, master’s or doctoral degree from an accredited school recognized by the

» MORE: Learn what it takes to qualify for an FHA home loan

Your next step

Start learning about OHFA first-time home buyer programs at the agency’s website. You’ll find details on income and purchase price limits, and links to lenders who are acquainted with these programs and their requirements. You also can find program criteria by county here, or call OFHA at 888-362-6432.

Not a first-time buyer? You may find help from Ohio’s Next Home program.

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