North Carolina First-Time Homebuyer Programs and Loans

If you’re looking to buy your first home in North Carolina, there are some programs that may help you save money, including down payment assistance and tax credits.

Here’s what you need to know about first-time homebuyer loans and grants in the Tar Heel State and what it takes to qualify for them.

First-time homebuyer programs in North Carolina

North Carolina offers several programs to help first-time homebuyers achieve their dreams of homeownership through the North Carolina Housing Finance Agency (NCHFA). These programs include down payment assistance, upfront cash toward your home purchase and a tax credit to help you save on mortgage interest each year.

NC Home Advantage Mortgage

The NC Home Advantage Mortgage provides mortgages and down payment assistance to first-time homebuyers and homebuyers looking to move to a more expensive house. 

You can get down payment assistance for up to 3% of the loan amount, with repayment only required if you sell, refinance or transfer your home in less than 15 years. As long as you stay in your home until year 15, your down payment assistance will be completely forgiven.

Requirements

Pros and cons

NC 1st Home Advantage Down Payment

Another homebuyer program in North Carolina is the NC 1st Home Advantage Down Payment. It provides down payment assistance to first-time homebuyers and military veterans. 

The program provides up to $15,000 in down payment assistance through a 0% deferred second mortgage. Like the NC Home Advantage Mortgage, this assistance is forgiven at the end of year 15 if you still own the home.

Requirements

Pros and cons

NC Home Advantage Tax Credit

The NC Home Advantage Tax Credit helps first-time homebuyers and veterans save up to $2,000 per year in federal taxes if approved for a mortgage credit certificate (MCC) by the NCHFA. 

You can claim a tax credit for 30% of your mortgage interest on existing homes or 50% on new homes, up to the $2,000 annual limit. You can still claim a mortgage interest deduction for the remaining interest you pay.

Requirements

Pros and cons

Community Partners Loan Pool (CPLP)

While not strictly a first-time homebuyer’s benefit, the Community Partners Loan Pool (CPLP) offers assistance to all low- and moderate-income homebuyers in North Carolina. You may be eligible to receive: 

This assistance is a 0% deferred second mortgage with no monthly payments. It must be repaid when you sell or reach the end of your loan term.

Requirements

Pros and cons

Self-Help Loan Pool (SHLP)

The Self-Help Loan Pool (SHLP) provides 0% shared-mortgage financing for low- and moderate-income buyers purchasing a Habitat for Humanity home. It’s a good option for buyers who are willing to help build or rehabilitate their home and need significant upfront support.

You may be eligible for a loan of up to $50,000 for up to 30 years, depending on your location and eligibility. Buyers must contribute to the home’s construction or rehabilitation and complete homebuyer education and counseling with a HUD-approved counselor.

Requirements

Pros and cons

North Carolina first-time homebuyer qualifications

The qualifications for first-time homebuyer programs in North Carolina vary, but most require at least a 640 credit score. You may also need to meet income and purchase price limits. Here’s how the application process typically works.

Steps to apply for a first-time homebuyer program in North Carolina

Step 1: Choose the right program

North Carolina offers several programs, some of which can be combined for maximal savings. Review the requirements, like credit score and income limits, to make sure you qualify, then read through the terms carefully to ensure it’s a good match.

Step 2: Ask for help

If you have any questions about the programs or application process, don’t hesitate to reach out to a HUD-approved housing counselor. These government-trained experts can offer independent guidance at any step of the process.

Step 3: Find an approved lender

Not all banks or lenders offer these programs. The NCHFA maintains a list of participating lenders. If you’re applying for the CPLP, you’ll need to work with a community partner lender. It’s best to speak with multiple lenders to determine the best one for your needs.

Step 4: Apply through your lender

After you choose a lender, you’ll need to apply for the program just as you would any other mortgage. This will include providing documentation, such as W-2 or tax forms, to verify your income. It’s essential to get preapproved for a mortgage even before you start house shopping to show sellers you’re a serious buyer.

Understanding North Carolina first-time homebuyer down payment assistance (DPA)

One of the typical challenges facing first-time homebuyers is coming up with a down payment. In North Carolina, there are several types of assistance that can help. Out of the 54 DPA programs in North Carolina, about 85% of them had available funding as of the fourth quarter of 2025, according to Down Payment Resource’s Homeownership Program Index.

Here are the most common types of assistance you can expect from a first-time homebuyer program.

Deferred second mortgage

Requires repayment? Yes

A deferred second mortgage is an additional lien on your home. It provides funds up front to help cover closing costs and/or the down payment. It’s repaid when the home is sold or refinanced.

Forgivable second mortgage

Requires repayment? No (if requirements are met)

A forgivable second mortgage is also a second lien on your home. However, in this case, the funds won’t have to be repaid as long as the buyer lives in the home for the required period of time.

Grant

Requires repayment? Usually no

Grants are given to homebuyers to pay their down payment and closing costs and generally won’t require repayment. However, depending on the type of grant, repayment could be required if the home is sold within a certain period.

Mortgage credit certificate (MCC)

Requires repayment? No (if requirements are met)

A mortgage credit certificate allows eligible buyers to claim a tax credit of up to $2,000 per year based on mortgage interest paid. You must meet the mortgage credit certificate requirements to qualify.

How much of a down payment do I need to buy a house in North Carolina?

The amount you’ll need for a down payment in North Carolina will vary depending on a number of factors, including the type of loan you secure and the size of your mortgage. 

On average, first-time homebuyers in North Carolina put down about $54,745 in Charlotte and $55,646 in Raleigh in 2025, according to LendingTree data.

Can I qualify for down payment assistance in North Carolina?

To qualify for DPA in North Carolina, you must meet these requirements:

How do I apply for North Carolina first-time homebuyer down payment assistance?

The first step to apply for first-time homebuyer DPA is finding a participating lender. The lender can then walk you through the application process. Alternatively, you can get guidance from an HUD-approved housing counselor, who can discuss the steps for various programs.

Other first-time homebuyer loan programs

Conventional loans

Conventional loans aren’t backed by the government. They typically come with more stringent credit requirements compared to other loan types. However, for those who qualify, conventional loans are typically the most cost-effective home loans.

FHA loans

FHA loans are backed by the Federal Housing Administration (FHA). They have lower credit score requirements than conventional loans, but also come with some extra costs, such as two forms of mortgage insurance. FHA mortgage rates are typically lower than conventional loan rates.

VA loans

VA loans are guaranteed by the U.S. Department of Veterans Affairs. They’re available to active-duty service members, veterans and surviving spouses. They typically offer lower interest rates and closing costs and don’t typically require a down payment.

USDA loans

Backed by the U.S. Department of Agriculture, USDA loans are available to low- and moderate-income borrowers to build or purchase a single-family home in eligible rural areas. Similar to VA loans, USDA loans don’t typically require a down payment.

What are the best first-time homebuyer loans?

The best loan for first-time homebuyers depends on factors including your credit score, savings and where you’re buying. Use this quick guide to find the option that fits your situation:

Home price trends in North Carolina’s major areas

Like most of the country, North Carolina has seen an increase in housing prices in recent years, though it hasn’t been as steep as in some states. In 2025, housing prices in North Carolina rose by only 0.9% — nationally, housing prices saw an average increase of 1.8%. 

Over a five-year period, however, housing prices in North Carolina have risen by 54.5% — a rate surpassed by only seven other states (New Jersey, Maine, Rhode Island, Connecticut, New Hampshire, Vermont and South Carolina).

Home prices in the Charlotte-Concord-Gastonia metro area — the state’s most recognized banking and finance hub — rose by 3.22% year over year. The Greensboro-High Point metro saw an even higher increase at 4.1%. In other areas, however, home prices rose by less. In the Raleigh-Cary metro — home to the state capital — for example, home prices rose by 1.2%.

What are the current mortgage rate trends in North Carolina?

Nationally, mortgage rates are expected to remain higher in 2026 than they were at the height of the pandemic. That said, over the past year, the 30-year fixed market rate is down 0.45% and the 15-year fixed market rate is down 0.29%. Rates are expected to remain steady around 6% throughout 2026, according to the current mortgage rate forecast from LendingTree.