What is first-time homebuyer assistance?
These programs are designed to help new buyers with the cost of purchasing a home. They typically provide one or more of the following:
- Down payment assistance
- Low-interest mortgage loans
- Grants that don’t need to be repaid
- Tax credits to reduce overall cost
Basic qualifications
While programs vary by state and lender, most require that you meet some common criteria:
- First-time buyer status: You haven’t owned a home in the past 3 years.
- Income limits: Your household income must fall within program guidelines, often based on the area median income (AMI).
- Credit requirements: A minimum credit score—usually 620 or higher—is required.
- Primary residence rule: The home must be your main place of living, not an investment property.
Types of first-time homebuyer programs in 2025
1. FHA Loans
Backed by the Federal Housing Administration, these loans allow buyers to qualify with a credit score as low as 580 and a down payment as little as 3.5%.
2. USDA Loans
Designed for rural and suburban buyers, USDA loans often require no down payment and offer low-interest rates.
3. VA Loans
Exclusive to veterans, active-duty service members, and some surviving spouses. VA loans require no down payment and come with flexible terms.
4. State and Local Grants
Every state offers its own set of grants and programs. Many provide cash for down payments or closing costs—sometimes up to $10,000 or more.
