First Time Home Buyer Loan
First Time Home Buyer Loan
A First Time Home Buyer Loan is a home or mortgage loan that is tailored to potential home buyers who are in the market for their first home. The First Time Home Buyer Loan is for potential home buyers who may have never been listed on a deed as an owner of real estate property. A First Time Home Buyer Loan will allow a potential home buyer a lower down payment, a reduced interest rate, limited lender fees, and a possible deferment of some future payments. A First Time Home Buyer Loan will usually be offered at the federal level by the Federal Housing Administration (FHA) and through most states that have the know-how to offer First Time Home Buyer Loans. A First Time Home Buyer Loan will deal with the potential for easier qualifying guidelines than many other mortgage loan types may not have, such as allowing for a higher debt to income ratio, a lower credit scores profile and a limited down payment.
A First Time Home Buyer Loan can have some advantages and disadvantages. Since there are often lower restrictions to a first time home buyer loan, one main advantage of a First Time Home Buyer Loan is it makes the First Home Buyer Loan ideal for the first time home buyer especially if the potential home buyer doesn't have a considerable amount of money saved for a down payment. Even if there is enough money saved up for a big down payment, the low interest rates that come with these types of loans are usually too good for anyone to pass up. A First Time Home Buyer Loan hopes to help potential home buyers achieve the American dream of owning a home for those who otherwise would not have the ability to buy a new home. One main disadvantage of a first time home buyer loan is this type of loan may not work out to be the best option for a first time home buyer. A first time home buyer loan will impose a limit on the cost of the property that the potential home buyer may be looking to purchase; the loan limit may only be up to 60 to 75 percent of what a conventional loan may be. One other main disadvantage with a first time home buyer loan is that the home that the potential home buyer is looking to purchase must be their primary home. If a potential home buyer is purchasing a home with the intention of renting it out, then that potential home buyer may not be accepted for this type of first time home buyer loans. Even with those two disadvantages, a first time home buyer loan still might be the most attractive type of loan for a potential home buyer; ultimately it will depend on their financial situation and the type of home that the potential home buyer is wishing to buy.