Rising Rent: How First-Time Homebuyers Can Achieve Homeownership

With the cost of rent climbing steadily in the last few years, buying a home may seem out of reach for many first-time homebuyers.

According to CBS News, rent has jumped 30.4% since 2019, and workers’ wages haven’t even begun to catch up to rising costs, making it harder for people to keep up with basic living expenses, especially housing.

If you’re feeling discouraged about your homeownership goals, take heart. The dream of owning your own home may be more within reach than you think and more affordable than you can imagine.

You may have heard that mortgage lenders require a certain percentage of funds as a down payment for the home you want to buy. While this is true, some programs help first-time homebuyers with their down payment and closing costs.

How Do I Qualify for Down Payment Assistance (DPA)?

DPA programs are designed to help first-time homebuyers and people with moderate to low incomes buy a home. However, it's important to know these programs have eligibility requirements. Understanding these requirements can help you prepare and increase your chances of qualifying. You can contact a Ruoff Mortgage loan officer to walk you through your options.

Types of DPA Programs

There are a multitude of different DPA programs. Here are a few:

• Grants: Homebuyers can receive grants through the state they reside in. Borrowers may qualify for up to 6% in assistance. The amount of assistance is based on the lesser of the sales price or appraised value of the home and is dependent on the type of loan financing the purchase. You can look for programs in your state through the U.S. Department of Housing and Urban Development website.
• Loans: Many lenders offer various financing options to meet the needs of homebuyers. The FHA loan is the most popular for many first-time homebuyers and those with moderate to low incomes. FHA loans can be a great option for homebuyers as they may offer a lower down payment, lower monthly premiums, and lower closing costs. Repeat homebuyers, you’re not left out of this option; you, too, may qualify.
• In-house programs: Some lenders offer in-house DPA programs for eligible borrowers. Ruoff Mortgage’s HomeNow program helps first-time and repeat borrowers with assistance for the entire 3.5% FHA down payment. It’s available for buyers with a minimum credit score of 620 who are looking to buy a single-family home.

Navigating the path to homeownership can be challenging, but with the right information and resources, your dream home may be closer than you think. By exploring various down payment assistance programs and understanding their eligibility requirements, you can find the support needed to make homeownership a reality. Remember, every step you take brings you closer to owning a home, and with determination and the right guidance, you can achieve your goals. Don't let rising costs deter you—contact a Ruoff Mortgage loan officer to discover your options and take the first step toward homeownership.