How To Qualify For First-Time Home Buyer Programs In NC with A Bad Credit Score

Oct 15, 2020

There are tons of first-time home buyer programs in NC for those looking to purchase their first property. But what if your credit score is less than ideal? If you have bad credit, you might find it hard to qualify for many home buyer programs. Luckily, there are a few…

Written By Offer Hut

There are tons of first-time home buyer programs in NC for those looking to purchase their first property. But what if your credit score is less than ideal? If you have bad credit, you might find it hard to qualify for many home buyer programs. Luckily, there are a few things you can do to make your dream of purchasing a home in 2020 a reality.

 

 

Consider an FHA Loan

For people across the nation seeking to purchase a home with a bad credit score, an FHA loan can be an appealing option. The FHA, or Federal Housing Administration, offers assistance to those with a credit score of at least 500. For buyers with a credit score of 500 to 579, the FHA can offer down payment assistance as long as you submit a down payment of at least 10% of the home’s cost. If your score is 580 or above, the FHA can provide a loan with a down payment as low as 3.5%.

 

 

Work to Improve Your Score

One of the best ways to qualify for first-time home buyer programs in NC is to improve your credit score. We know this is easier said than done, but it will benefit you in the long run! Start by working to pay off credit card debt and reduce payments on your car or student loans. Make sure you’re paying all your bills on time, and keep your credit card balances low. Even once you get your credit cards paid off, don’t close the account, as this can make your score drop. If you can’t or don’t want to apply for an FHA loan, these tips could help you qualify for our next suggestion.

 

Apply for an NC Home Advantage Mortgage

The NC Home Advantage Mortgage is an incredibly popular option for first time home buyers in North Carolina. It’s offered by the North Carolina Housing Finance Agency (NCHFA) and is available to those with a credit score of 640 or higher. If you’re applying for an FHA loan or a loan through the USDA or VA, this program can be used in combination. NCHFA will provide fixed-rate mortgages as well as down payment assistance of up to 5% of the loan amount.

With the same credit score of 640 or higher, you can also qualify for the NC 1st Home Advantage Down Payment. This program can provide up to $8,000 in down payment assistance to both first time home buyers and military veterans. Finally, you may qualify for the NC Home Advantage Tax Credit, which could grant you a Mortgage Credit Certificate (MCC) and save you up to $2,000 per year on your federal taxes.

 

 

Having a bad credit score doesn’t have to stop you from buying a home. With one of these first-time home buyer programs in NC, you’ll be well on your way to purchasing your dream house!

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