Louisiana First Time Home Buyer – 2019 Loan Programs
Are you looking to purchase your first home? Our first time home buyer programs might be the perfect solution to help you obtain the financing you need to purchase the home you desire. We provide excellent home financing options, and encourage you to compare our offered loan terms to other mortgage lenders.
Louisiana First Time Home Buyer Loans
There are 5 types of first time home buyer loans. You may select different loan terms, such as a fixed rate or adjustable rate mortgage, and the number of years to repay the loan (such as a 30 year fixed rate mortgage).
Types of Mortgages:
- Conventional Loans – Conventional loans offer the best loan terms to borrowers with good or excellent credit, as well as those who can afford to place a larger down payment. If you are able to put 20% or more down, you will be able to avoid paying private mortgage insurance (PMI). However, conventional loans also offer low down payment options, such as programs that only require 3% down.
- FHA Loans – FHA loans are a good option for borrowers who may not be able to qualify for a conventional loan. The qualification requirements for FHA loans are much more lenient than conventional loans. This includes options for home buyers with credit scores as low as 500 (in order to qualify for a 3.5% down payment, you must have a credit score of at least 580).
- USDA Loans – USDA loans provide home buyers the opportunity to purchase a home without any down payment. These loans are intended for borrowers with low-to-moderate income. In addition to not requiring any money down, you can also finance the closing costs into the loan. This means you can essentially buy a home with no money out of pocket!
- VA Loans – Active duty military members and veterans can apply for a VA loan which allows you to buy your first home without any down payment. These loans are not available to the general public, but exclusively to military/veterans.
- Jumbo Loans – Any loan that does not meet the conforming or FHA loan limits is a jumbo loan. The 2019 FHA loan limits in Louisiana are $314,827 for all counties. The conforming loan limits, which are applicable to conventional and VA loans, is $484,350. If you want to buy a more expensive home than what these limits will allow, and have the income to qualify, we provide what are known as jumbo loans up to $2,000,000.
The above 5 types of loans are the main first time home buyer options that exist. We can help you determine which loan is the right fit for you based on your particular needs and eligibility.
Louisiana Down Payment Assistance Programs
First time home buyers in Louisiana may be eligible for down payment assistance. This includes programs offered throughout the entire state, as well as several locally offered programs (available at the city or county level). You can learn about these down payment assistance programs below:
Market Rate GNMA Program
The Louisiana Housing Corporation offers the Market Rate GNMA Program. This is a down payment assistance program for first time home buyers and repeat buyers alike. The programs offers up to 4% in down payment assistance.
- The home must be located in Louisiana.
- A credit score of 640 or higher is required.
- Your income must not exceed the limits for your parish. You can view the income limits here.
- The program is for single family residences only.
- Your mortgage must be a 30 year fixed.
You can learn more about this program on the Louisiana Housing Corporation website.
Jefferson Parish Down Payment Assistance Grant
The Jefferson Parish Housing Authority offers a grant for first time home buyers. In order to qualify for assistance, you must meet all of the program requirements.
- The property must be located in Jefferson Parish.
- Complete a homebuyer education course.
- Occupy the home as your primary residence.
- The purchase price must not exceed $181,000 for an existing home, or $228,000 for new construction.
- You must meet the current income limits.
To learn more about this program, visit the official website for Jefferson Parish.
LPTFA First Time Home Buyers Program
The Lafayette Public Trust Finance Authority offers a down payment assistance loan of up to $8,000 to first time home buyers. The funds are provided as a second mortgage with an interest rate of 5%.
- The home must be located in Lafayette Parish.
- The maximum purchase price (for a new or existing home) is $316,177.
- Complete a first time home buyers training program (education course).
- You must meet the income limits. For 1-2 persons in your household, the combined income must not exceed $84,480. For 3 or more persons in your household, your total household income must not exceed $98,560.
To learn more about this program, please visit the Lafayette Public Trust Finance Authority website.
Shreveport Home Buyers Assistance Program Participation Initiative (HAPPI)
The Shreveport Home Buyers Assistance Program Participation Initiative (HAPPI) is an incredible home buying program, offering up to 20% in down payment assistance. In order to qualify for the assistance, you must meet all of the program requirements.
- Be a first time home buyer (or have not owned any real estate in the last 3 years).
- Complete a homebuyers education class in order to be eligible.
- The property must be your primary residence (no investment properties allowed).
- Your household income must be under 80% of the average median income.
- 1 person – $31,750
- 2 person – $36,250
- 3 person – $40,800
- 4 person – $45,300
- 5 person – $48,950
- 6 person – $52,550
- 7 person – $56,200
- 8 person – $59,800
To learn more about this program, visit the Shreveport Community Development website.
Lake Charles Down Payment Assistance Program
The city of Lake Charles Community Development Division first time home buyer DPA offers up to $10,000 in assistance for qualifying applications. In order to qualify, you must meet the program requirements.
- The home you purchase must be located within the city limits of Lake Charles.
- You must complete a homebuyer education course.
- You can not have more than $5,000 in savings.
- Your mortgage payment must not exceed 35% of your income.
- You must meet the income limits, which are outlined below.
- 1 person – $30,450
- 2 persons – $34,800
- 3 persons – $39,150
- 4 persons – $43,500
- 5 persons – $47,000
- 6 persons – $50,450
- 7 persons – $53,950
- 8 persons – $57,400
To learn more about this program, visit the city of Lake Charles website.
Louisiana First Time Home Buyer Tax Credits
The Mortgage Credit Certification (MCC) tax credit provides you an opportunity to reduce your tax bill, as well as enhance your home loan application by reducing your debt-to-income ratios. How this works, is you can deduct up to $2,000 off your federal tax bill each year. The MCC allows up to 35% of your annual interest to be eliminated (with the cap being at $2,000). Some great news, is this can be used in addition to standard mortgage interest deductions!
Frequently Asked Questions About Buying Your First Home
How much do I need for a down payment?
It depends on the type of loan you want. USDA and VA loans often will not require any down payment. FHA loans require a 3.5% down payment. Conventional loans typically require either 3% or 5%. If you receive down payment assistance, you may not need any money for your down payment.
What is the maximum loan amount that I can qualify for?
The amount that you will be allowed to borrow will depend mostly on your income, as well as the particular type of loan you are interested in. There are maximum loan limits for each type of mortgage program which are set at the county level. Conforming loan limits are the maximum loan amounts allowed for conventional mortgages. FHA loans have their own loan limits. This is not necessarily how much you can borrow though, but the maximum amount allowed in your location. The amount that you can personal qualify for will be based upon your income, and how much debt you have. For most loans, your monthly mortgage payment, along with your monthly debts may not exceed 43% of your income.
Can I buy a home without a real estate agent?
It depends on your state and the type of loan program. For some states, you must use an agent. In other states, you are not required to use a real estate agent for many loan program, such as conventional mortgages. However, some loan types require that you use a real estate agent regardless of your location, such as USDA loans.
Do you have first time home buyer loans for bad credit?
Yes, we offer mortgage options for borrowers with bad credit. This includes FHA loans for bad credit, which you can possibly be approved with a credit score as low as 500. However, a 580 credit score is required for the 3.5% down payment. If your credit score is between 500-579, then you will need to put 10% down.
Can I buy a home if I owe tax debt?
For government-backed loans, such as FHA, VA, and USDA loans, you can buy a home with tax debt as long as you have made a payment plan with the IRS, and are not behind on the payments. Any federal debt must be in good standing in order to get a government-based mortgage. If your tax debts have moved into the status of a tax lien, this will prevent you from getting a home loan until it is resolved.
Can I buy a home if I have student loans?
As long as you are not delinquent on the student loan payments, and the monthly payments do not cause excessive debt-to-income ratios, you can still get a mortgage.
Can I buy a home without my spouse?
A common question is if you can buy a house without your wife or husband. The short answer is yes. There are numerous reasons someone may want to exclude their spouse from a mortgage application, such as lower credit, lack of job history or income, or one spouse having excessive debt that could prevent an approval. You may be able to qualify and get a home loan without your spouse.
How do I know if I am ready and prepared to own a home?
It is critical to consider the often unexpected expenses of buying a home. This includes repairs, maintenance, and of course furnishing the home, monthly utilities, and all other expenses that are associated with homeownership. A common mistake is to just look at the difference in rent to your total mortgage payment. Almost every year, you can expect to have to pay for various upkeep to keep the property functional. This can include anything from repairing a hot water heater that broke, to landscaping, and various maintenance.
Something else financial consultants advise is that you have at least 3 months of reserves. This means that you could afford to make your new mortgage payment for at least 3 months in the event that you lose a job or have some other unforeseen circumstance that the savings would be needed for. This is not a requirement for most home loans, but it is good advice to consider.
Have more questions about buying your first home? Give us a call at 1-800-731-3560.