A Guide to First-Time Home Buyer Programs, Loans, and Grants

A Guide to First-Time Home Buyer Programs, Loans, and Grants

Buying a home in Charlotte, N.C., or another location can be exciting. But when you're a first-time home buyer, it can be a bit intimidating. After all, you have all these obligations, including a down payment, taxes, and closing costs, and don't forget your mortgage loan.

Since it's your first time buying a home, you have various programs available in the form of loans, grants, and other resources. Here, you'll learn some programs you can look into to help you get into your dream home without a hitch.

Various first-time home buyer programs

You can tap into many programs, including local and federal grants, loans, tax credits, and down payment assistance (DPA). You even have educational programs, student grants, and employer-sponsored programs.


DPA is a program giving grants or low-interest loans that don't require you to pay back. Statistics show that 26% of first-time property buyers state that trying to save for the down payment on their home was the most difficult part of the process. Whether or not you qualify for DPA grants or loans will depend on which type of assistance you're looking into.
DPA loans
With DPA loans, you have the following options:
  • Take out a second mortgage: You'll need to take care of your second mortgage when you pay off your first.

  • Apply for a forgiveness loan: This loan is predetermined at closing, and you typically have a certain number of years to pay it off.

  • Apply for a deferred payment loan: With this loan, you pay it back when you sell or refinance your home or move and pay off your first mortgage.
DPA grants
You can also get DPA through these grants and don't have to pay them back. But you have to qualify for them, and each DPA grant will come with its own set of requirements, such as having a certain income level or credit score. One well-known option for DPA grants for housing is the National Homebuyers Fund.

Government-backed loans

The U.S. government insures certain mortgage loans. Lenders have less risk with government-backed loans; therefore, they can offer their borrowers loans that require a low down payment or no down payment at all.

Tax deductions

First-time home buyers can take advantage of various state and federal tax deductions, which can help lower their taxable income. You can also look into state or local government credits and deductions.

Closing assistance

You can apply for a grant or loan through government-sponsored programs to help you pay for your closing costs, including:
  • Appraisals.
  • Title insurance.
  • Lawyer fees.
  • Inspections.
  • Real estate tax services.
  • Lending fees.
  • Property taxes.

Home buyers sometimes negotiate with the seller to pay some of these closing costs. This is known as seller concession and helps make buying a home more affordable.

Federal first-time home buyer programs

You'll find these types of programs nationwide from various sources. With federal programs for first-time buyers, you'll find:
  • Closing cost assistance.
  • DPA.
  • Lower interest rates.
  • Other types of assistance,

Government-backed loans

Lenders can offer you lower rates and payment options since there's less risk to them with government-backed loans. These include United States Department of Agriculture, Veteran Affairs, and Federal Housing Administration loans.

Good Neighbor Next Door

The Department of Housing and Urban Development (HUD) sponsors the Good Neighbor Next Door Program. It offers teachers (pre-K through 12), firefighters, emergency medical technicians, and law enforcement officers a whopping 50% discount on select HUD properties.

Local and state programs for first-time homebuyers

There are programs you can look into right here in your neighborhood throughout Charlotte, N.C., such as the following:

House Charlotte

This program provides forgivable and deferred loan options for homebuyers who qualify. You can receive up to $80,000 in down payment, interest rate, and closing cost assistance.

North Carolina Housing Finance Agency (NCHFA) $15,000 NC Bond Loan

Charlotte homebuyers and those buying homes in North Carolina may qualify for the NCHFA Bond program. This DPA program helps you with the down payment on your home — up to $15,000.

Nonprofit or charitable first-time home buyer programs

You may be eligible for nonprofit or charitable assistance if your income is low. Nonprofits and charities are not run by the government and can provide financial and educational resources when purchasing a home.

Habitat for Humanity

A well-known international nonprofit organization, Habitat for Humanity, offers affordable housing for low-income families. They don't earn any profit off the home you close on since they have volunteers who construct the home for people in need, so this provides you with an affordable home option.

Neighborhood Assistance Corporation of America (NACA)

NACA offers affordable housing options to individuals in need. It's a nationwide nonprofit offering financially unstable households mortgage education and counseling. Mortgages through NACA don't require down payments, closing costs, or mortgage insurance.

Employer-sponsored programs for first-time home buyers

Employers sometimes offer housing incentives like grants or forgivable loans to help employees pay their down payments and closing fees. You'll need to sit down with your employer or human resources manager and ask about these incentives.

First-time student home buyer grants and loans

Because of flexible Department of Trade and Industries requirements, it can sometimes be simpler for recent graduates or current students to become eligible for a mortgage. Students can benefit from DPA, specialty loan qualification, closing cost assistance, and reduced mortgage interest rates.

First-time home buyer program FAQ

You may have questions about being a home buyer for the first time, including the following:

What is a first-time home buyer?

To be considered a first-time home buyer, you can't have owned a home in the last three years. So, if you have owned a home, but it was more than three years ago, you could still qualify and take advantage of these types of programs. But if you owned a home within the past three years, you're not considered a first-time buyer and would not qualify. There are other qualifying criteria to meet as well.

Who qualifies for first-time home buyer programs?

If you own a rental or investment property, whether you're living in it or not, you will not qualify for this program. Your home has a qualification process to qualify for government-backed loans. There are typically income restrictions with local and state government programs.

Get the help you need when buying a home for the first time

There are many different loan and grant programs and other financial help for first-time home buyers that can make purchasing a home much smoother and more affordable. In addition to the down payment and closing cost assistance, you can take advantage of mortgage education and counseling. You could qualify for state, local, or federal government assistance if you meet specific income requirements.

Remember, charities, nonprofits, and employer programs are likewise available. Contact professional Charlotte, N.C., real estate agent Shawn Gerald to get your questions about first-time property buyer programs answered and give you the help you need when buying your new dream home.

*Header photo courtesy of Shutterstock


My top priority is to serve my clients to the best of my ability. My goal is to provide valuable service to the community I serve in any way that I can. My discipline and work ethic from my time in the Marines have carried over into my career as a Real Estate Agent. I am excited to help you achieve your real estate goals and look forward to hearing from you soon!

Follow Me on Instagram