First-Time Homebuyer Programs: State and National Resources

If you’re buying a house for the first time, there are many programs available to help you achieve your homeownership goal. From help with your down payment and closing costs to lower interest rates and even grants, first-time homebuyer programs can take some of the financial pressure off your plate.

You can use the map below to explore programs available in your state or check out loan options offered nationwide. Once you have a sense of what’s out there, we’ll walk through some of the most popular national programs and how to choose the one that best fits your situation.

First-time homebuyer programs by state

At a glance: National first-time homebuyer programs

Click on each loan program in the table below to learn about the details and requirements.

Conventional loans

1. Fannie Mae HomeReady®

The HomeReady loan program is a conventional (non-government) mortgage guaranteed by Fannie Mae and offered through participating lenders. Available to low- and moderate-income borrowers, HomeReady loans have low down payment requirements, allow flexible income sources and carry reduced private mortgage insurance (PMI) costs. Borrowers with very low incomes can also qualify for a borrower credit up to $2,500.

Best for: The HomeReady loan program is best for low- and moderate-income borrowers with at least a 620 credit score.

2. Fannie Mae Standard 97% Loan-to-Value (LTV)

Fannie Mae has another low-down-payment loan offered through participating lenders — and this one comes with no income restrictions. The Fannie Mae Standard 97% LTV loan requires first-time homebuyers to only put down 3%, and has flexible guidelines that allow for many down payment sources. However, borrowers will need to take a homebuyer education course. They’ll also pay standard PMI premiums, but won’t be subject to income limits.

Best for: Fannie’s Standard 97% loan is ideal for borrowers who have good credit but lack the savings for a significant down payment.

3. Freddie Mac Home Possible®

Home Possible is another conventional loan program for low- and moderate-income borrowers. Home Possible loans have a low down payment minimum, discounted mortgage insurance and flexible income guidelines.

Best for: Home Possible is designed for low- or moderate-income borrowers seeking a low-down-payment loan with at least a 660 credit score. It’s also a great option for those with no credit score who can put down at least 5%.

4. Freddie Mac HomeOne®

HomeOne from Freddie Mac is another conventional loan with a low down payment minimum and flexible income guidelines. This loan requires at least one co-borrower to be a first-time homebuyer; however, if all borrowers are first-timers, they must take a homebuyer education course. Buyers will pay standard mortgage insurance premiums, but won’t be subject to income limits.

Best for: HomeOne is best for borrowers with good credit scores looking to purchase a home with a low down payment.

Government-backed loans

5. FHA loans

FHA loans are backed by the Federal Housing Administration (FHA) and follow mortgage guidelines set by the U.S. Department of Housing and Urban Development (HUD). Popular with first-time buyers, FHA loans have low down payment requirements and flexible qualification guidelines. But while FHA mortgages don’t have income restrictions, they are subject to maximum loan limits based on the borrower’s county and property type. FHA loans can be used for single-family properties and homes with up to four total units.

Best for: FHA loans are ideal for borrowers with limited down payment savings or blemishes in their credit history. 

See current FHA loan rates.

6. FHA 203(k) loans

Borrowers purchasing a fixer-upper can combine the costs of buying a home and renovating it into one loan with an FHA 203(k) mortgage. Insured by the FHA, these loans follow the same basic requirements as standard FHA loans. There are two types of FHA 203(k) loans: limited, for minor improvements and repair costs and standard, for larger repair projects. Borrowers need to work with a certified 203(k) consultant to use these home loans.

Best for: FHA 203(k) loans are great for borrowers purchasing a fixer-upper who want a low down payment or need a program with lower credit score minimums.

7. VA loans

The U.S. Department of Veterans Affairs (VA) offers a loan program to active-duty service members, veterans and eligible surviving spouses. VA loans have no down payment requirement or income limits but offer flexible credit guidelines. Borrowers won’t pay ongoing mortgage insurance, but they do pay an upfront funding fee.

Best for: VA loans are ideal for eligible military borrowers and surviving spouses, especially those seeking a no-down-payment loan.

See current VA mortgage rates today.

8. USDA loans

The U.S. Department of Agriculture (USDA) offers two types of mortgages: USDA guaranteed loans and USDA direct loans. Both USDA loan programs offer no-down-payment loans to borrowers purchasing in rural areas of the country. 

The guaranteed loan program, provided through participating lenders, is aimed at low- and moderate-income borrowers. Buyers in that program must pay an upfront and annual guarantee fee. The direct loan program loans are aimed at very low- and low-income borrowers and come with payment assistance for a short amount of time.

Best for: USDA loans are best for very-low, low- and moderate-income homebuyers purchasing in designated rural areas.

9. Good Neighbor Next Door

Good Neighbor Next Door is a mortgage program offered by HUD for public service professionals like police officers and teachers. Eligible borrowers receive a 50% discount on the purchase price of HUD properties in designated revitalization areas. If they finance the home with an FHA loan, the minimum down payment is only $100. To receive the purchase price discount, borrowers take on a silent second mortgage, meaning they won’t make any payments or pay interest, as long as they remain in the home for three years.

Best for: Good Neighbor Next Door is designed for people in public service careers who want to purchase a home in a revitalized area and are willing to live in the home for at least three years.

10. HUD Homes

This program gives buyers the opportunity to purchase foreclosed homes owned by HUD at below-market prices. Borrowers can use a wide variety of loans to buy a HUD home, depending on the home’s condition. Notably, while a borrower can review listings in their state, they’ll need to work with a HUD-registered real estate agent or broker to actually bid on a property.

Best for: HUD Homes are best for buyers looking for a deeply discounted home who can take on the cost and responsibility of renovations and repairs. 

11. HomePath

Fannie Mae HomePath is an online platform that lists foreclosed homes for sale to the public. This gives buyers the chance to find homes at a low price, often in “as-is” condition.

First-time homebuyers who use the program and complete the Fannie Mae HomeView education course can qualify for up to 3% in closing cost assistance. HomePath is the platform where you search for these homes, but borrowers can use various first-time homebuyer loans to finance the purchase (including the Fannie Mae HomeReady mortgage).

Best for: The HomePath platform is designed for homebuyers looking for affordable housing who are willing to purchase homes in as-is condition. 

12. Native American Direct Loan

The Native American Direct Loan (NADL) is a VA loan available to Native American veterans or veterans married to a Native American spouse. Like all VA mortgages, the NADL program doesn’t require a down payment, and borrowers receive lower interest rates and reduced closing costs. 

Best for: NADL loans are best for eligible veterans seeking a low-cost, no-down-payment loan.

How to use first-time homebuyer programs

Step 1: Explore available options: Start by researching first-time homebuyer programs offered at the federal, state and local levels. Options can include federal programs and state-run assistance programs that provide grants or forgivable loans for down payments and closing costs. 

Step 2: Confirm eligibility: Each program comes with specific requirements, so it’s important to review them closely before moving forward. Eligibility may be based on factors like your income, credit score, debt-to-income ratio and the purchase price of the home. Some programs also require you to be a true first-time buyer (meaning you haven’t owned a home in the past three years), while others are more flexible. You may also need to live in the home as your primary residence.

Step 3: Get preapproved with a lender: Once you have a sense of which programs you may qualify for, connect with a mortgage lender who is familiar with first-time homebuyer assistance. Not all lenders participate in every program, so it helps to ask about their experience. During preapproval, the lender will review your finances, verify your income and credit and give you an estimate of how much you can borrow. 

Step 4: Find a home and apply for a mortgage: After finding a home and choosing a loan and assistance program, you’ll complete a formal application and submit documentation such as pay stubs, tax returns and bank statements. Some programs also require a homebuyer education course that walks you through the responsibilities of homeownership. From there, you’ll work with your lender through underwriting, finalize your loan terms and prepare for closing. 

Am I ready to buy a home?

Before you gear up to purchase a first home, it’s crucial to answer some important questions. The following can help you gauge whether you’re ready to buy a home — or if you should wait until you’re better prepared.

Do I have enough saved for upfront costs?

Beyond a down payment, first-time homebuyers need to plan for closing costs, moving expenses and an emergency fund. Many buyers are surprised that closing costs alone can run 2% to 5% of the home price. First-time homebuyer programs may help reduce these costs, but you’ll still need money for a range of moving-related expenses.

Is my credit profile strong enough to qualify for a good loan?

Your credit score plays a major role in both your loan approval and the interest rate you receive. First-time buyers can often qualify with lower credit scores through programs like FHA loans, but stronger credit typically means better terms. Before applying, review your credit report, pay down debts if possible and avoid opening new accounts that could temporarily lower your score.

Am I financially ready for the full cost of homeownership?

Owning a home involves more than just a monthly mortgage payment. You’ll also need to budget for property taxes, homeowners insurance, maintenance and repairs. As a first-time buyer, it’s important to look at your full monthly budget and make sure you can comfortably handle these costs without stretching yourself too thin.

How stable is my income and job situation?

Lenders want to see consistent income and employment history before they approve you for a loan. Beyond qualifying, you should also consider your own comfort level with long-term financial commitments. If your income is variable or you anticipate major career changes, it may be worth waiting until your situation is more stable before buying your first home.

Am I ready to stay in one place for several years?

Buying a home comes with upfront costs that take time to recoup. As a first-time buyer, it generally makes sense to plan to stay in the home for at least a few years. If you think you may need to move sooner, renting could offer more flexibility while you continue saving and preparing for homeownership.