With the country's economy and housing crisis currently on everyone's mind, owning your own home may not seem like a realistic venture right now. But home ownership shouldn't be out of anyone's reach, including lower income families and first-time buyers. Before dashing out to your local lender, however, educating yourself on what government backed loans and programs are available is essential to your long-term homeownership success.

 

Federal Programs

FHA Mortgage

Since the 1930s, the Federal Housing Administration has been helping families become homeowners with a set of programs commonly known as FHA mortgages. Formed in 1934 by Congress, the FHA became part of the Department of Housing and Urban Development's Office of Housing (HUD) in 1965. Today it acts as a buffer to lenders by reducing their risk in issuing loans as well as helping borrowers get amounts they qualify for.

Continue reading about FHA Mortgage Loan.

 

VA Mortgage Loans

Designed to provide millions of U.S. veterans and their families with affordable housing, the VA loan emerged through the GI Bill of Rights, which was signed off in 1944 by President Roosevelt.

Continue reading about VA Mortgage Loans.

 

Rural Development Guaranteed Housing

Under the U.S. Department of Agriculture (USDA), the Rural Development Administration helps low- to moderate-income families purchase homes with low interest rates and little or no down payment.

 

The American Dream Downpayment Initiative - ADDI

The American Dream Downpayment Initiative was created in 2003 to aid low-income, first-time homebuyers in achieving affordable housing by eliminating two of the biggest hurdles in buying a home: a downpayment and closing costs.

 

Teacher Next Door Program

Established by HUD in order to provide affordable housing to teachers and education administrators, the Teacher Next Door Program offers a 50% discount on homes purchased in low- and moderate-income neighborhoods.

 

Reverse mortgages

A reverse mortgage is a loan available for seniors wherein the payment stream is reversed. Rather than you paying the lender, the lender gives you monthly payments according the equity of your home.

Continue reading about Reverse mortgages.

 

State Programs

Good Neighbor Next Door Sales Program - GNND

In an effort to improve communities across the country, HUD has designed the Good Neighbor Next Door Program to make housing more affordable to those who work in law enforcement, primary and secondary education and other municipal services such as firefighting and emergency medical services.

 

CT-FAMLIES

CT FAMLIES is a refinancing option for those who are already paying a mortgage on a home, but due to subprime mortgage rates, which are scheduled to be reset at much higher rates from October 2007 to December 2009, many of these 71, 000 mortgages are delinquent and close to default.

 

State of New York Mortgage Agency - SONYMA

SONYMA offers 5 unique programs to help in your quest to become a first-time homeowner, all of which offer below market interest rates, a low downpayment, no prepayment penalties and assistance with closing costs.

 

HomeChoice Program

Designed to meet the needs of low- and moderate-income homeowners and first-time homebuyers with disabilities or a family member with disabilities living with them, the HomeChoice Program offers borrowers the ability to purchase a home anywhere within California.

 

Self Help Homeownership Opportunity Program

Created in response to the growing number of families unable to afford a home, SHOP provides funding for nonprofit organizations who purchase home sites in order to develop safe and sanitary non-luxury housing for low-income families and individuals.

 

Association of Community Organizations for Reform Now - ACORN

Since its inception in 1970, ACORN has grown to become the largest community organization of low- and moderate-income families in the nation. With over 350, 000 members and chapters across the U.S. as well as cities in Argentina, Peru, Mexico, the Dominican Republic and Canada, ACORN has helped develop communities through campaigning and fundraising for better housing, schools, neighborhood safety, health care and job conditions, to name a few.

 

Community Frameworks

Established in 1974, Community Frameworks is a nonprofit organization aimed at building stronger communities in Washington, Oregon, Idaho and Montana. Community Frameworks assists in building and preserving homes for renters and first-time homebuyers as well as as aiding other organizations to meet the housing needs of low-income homebuyers via their various programs.

 

Habitat for Humanity International

As a nonprofit Christian housing ministry, HFHI has provided over 1 million people with safe, decent and affordable housing. Founded in 1976 by Millard and Linda Fuller, HFHI encourages volunteers from all backgrounds and religions to help families in need to build shelters and homes.

 

Energy Efficient Mortgages

Since 1995, HUD has been providing mortgage insurance to help persons incorporate the cost of energy efficient improvements into a purchase or refinance mortgage. One way to reduce your spending is to cut the cost of your utility bills. And replacing those drafty windows and leaky ducts might be easier than one thinks.

Continue reading about Energy Efficient Mortgages.

 

High Cost Area Purchase Assistance Program

Designed to aid first-time homebuyers in purchasing a home in some of California's higher cost counties, HiCAP is to be combined with a CalHFA conventional first mortgage program. California's higher cost counties include Alameda, Contra Costa, Los Angeles (except Palmdale/Lancaster Areas), Marin, Monterey, Napa, Orange, San Benito, San Francisco, San Luis Obispo, San Mateo, Santa Barbara, Santa Cruz, Solano, Sonoma and Ventura.

    Published on September 1, 2008