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Otero County, CO First Time Home Buyer

Learn Everything You Need to Know About Buying Your First Home in Otero County, CO
Down Payment Assistance - Best Program Options - Low Interest Rates

Otero County, CO – First Time Home Buyer

Are you looking to purchase your first home? Our Otero County, CO first time home buyer loan programs might be the perfect solution to help you obtain the financing you need to buy the home you desire.  We provide excellent home financing options, and encourage you to compare our offered loan terms to other mortgage lenders.

Otero County, Colorado First Time Home Buyer Loan Programs

  • FHA Loans – May consider FHA loans to be the best first time home buyer loan .  They are easy to qualify for and “fair credit” is allowed (620 or higher).  FHA loans also offer a low down payment requirement of only 3.5% and FHA allows down payment assistance programs.
  • Conventional Loans –  Conventional mortgages are best for those who can afford to pay a large down payment.  They also are often better than FHA loans for those who have good or excellent credit.  Conventional loans also have low down payment options.
  • USDA Loans – USDA loans are the best option for most who want to purchase a home in a rural and select suburban areas.  They are available for very low income, low income, and moderate income borrowers.  USDA loans do not require any down payment and closing costs can be financed 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.  Otero County FHA loan limits are as follows:  Single unit: $314,827.  Two units: $403,125.  Three units: $487,250.  Four units: $605,525.  For conforming loans, which are used for conventional and VA loans, the maximum loan limits are:  Single unit: $484,350.  Two units: $620,200.  Three units: $749,650.  Four units: $931,600.  If you want to buy a more expensive home, 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.

First Time Home Buyer Application

It is easy to get a quote for your first home loan!

Otero County – Down Payment Assistance Programs

There are a two different down payment assistance programs available in Otero County.  This includes the Tri-County Housing Program , and the other is the Colorado statewide CHAC program.

Tri-County Housing Program

The Tri-County Housing Program offers up to $50% of your down payment and $3,000 in closing costs assistance.  The details for this program are scarce, but our understanding is that funds are currently available.  You can contact Tri-County Housing, or speak with one of our loan specialists and they can help you inquire to see if you are eligible.

Colorado Housing Assistance Program

For more assistance, potential buyers can look to the CHAC. Their organization provides flexible loans with low interest to low- to moderate-income families. It is processed as a second mortgage and is repaid on a monthly basis, however, the start date for repayment can vary. Borrowers are also expected to be able to pay $1,000 of their own money to cover general mortgage fees.

To begin the application process, borrowers must first attend a CHAC approved home buyer class. This is required and non-negotiable. Following this, an application for assistance can then be filled out. Successful applicants are expected to adhere to certain guidelines.

  • The borrower cannot have owned a property in the past three years.
  • The property must be inhabited as a primary residence. Should it not be used this way, the loan will be due back in full plus any accumulated interest immediately.
  • Full disclosure of assets and income of every person that will be living in the home has to be given.
  • At closing, no money back is provided.
  • Should the borrower pay off the entire first mortgage, the remaining amount on the CHAC loan will be due.

You can learn more about the CHAC down payment assistance program here.

Otero County First Time Home Buyer Classes

Tri-County Housing offers free homebuyer education classes.  This includes both online and in person courses.  You can learn more and register here.  These classes teach you about a wide range of topics related to homeownership, including everything from buying a home to maintaining it.

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, which if you get down payment assistance, only .5% is required.  Conventional loans typically require either 3% or 5%.

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.

How much can I afford to borrow?
The amount that you can borrow depends on your particular loan type and income. There are maximum loan limits which are set at the county level. Conforming loan limits are the maximum lending amount allowed for conventional mortgages. FHA loans have their own loan limits. You can search the maximum loan amount for your county for each particular loan type by entering your zip code (or any zip code for the county you want to buy a home in). This will display the maximum amount available for all loan types. This is not necessarily how much you can borrow though, but the max amount in your location. Your personal limits will be based upon your income and how much debt you have. For instance, with most loans, you can not have a mortgage payment and debts 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.

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.

Can I buy a home after foreclosure?
Most loan programs will require you to wait 3 years before you can buy again after a foreclosure.  There are some instances that you might be able to get an approval in as little as 12 months.  This includes the FHA extenuating circumstances program (more commonly known as the “FHA back to work program”).  If you lost your job due to a job loss or some other event out of your control, you might be able to purchase a home with a FHA loan after only 1 year.

I do not have much credit, can I still get approved?
A 580 minimum is required for a FHA loan. A 620 is required for all others. You may find a lender who can help you if you have poor credit. We do not offer any bad credit mortgage programs

Have more questions about buying your first home?  View our list which covers even more commonly asked questions about buying a home.  Or you can give us a call at 1-800-731-3560.

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