Buying a home is a major financial investment, which is why many low-income earners feel that owning their own home is out of their reach. On top of paying for the home itself, you’ve also got to come up with a sizeable down payment and money for moving expenses and closing costs.
Utilities may be more expensive than the place you’re renting. And, as a homeowner, you’re also tasked with paying for any repairs or maintenance to the home.
Though buying a home can get expensive fast, Mississippi home buyers have several ways to help trim their costs. There are a number of helpful programs, grants, and mortgage options specifically for lower-income home buyers that can help you overcome some of these financial barriers.
Best Mississippi Loans & Grants for Low-Income Home Buyers
Mississippi’s programs and grants for low-income home buyers are worth exploring, especially if this is your first time buying a home. Take a look at some of the most popular options available:
Offered by the Mississippi Home Corporation, the Smart Solutions program offers cost-saving benefits to home buyers, including low-interest rates and help with down payment and closing costs. There is an income limit with this option, which reinforces their commitment to helping low-income earners achieve their home-buying dream.
Housing Assistance for Teachers (HAT)
This program is designed to encourage teachers to move to and teach in rural areas. Those will qualify will receive a grant for $6,000 to help with a down payment and closing costs. The buyer will need to contribute at least 1% of the home’s purchase price to the down payment.
Mortgage Revenue Bond 7 (MRB7)
If you’re struggling to come up with the down payment and closing costs for a home, this bond may be able to help. If you’re a first-time home buyer, a veteran, or are buying a home in a specific low-income area, you could get up to $7,000 in down payment and closing cost assistance in the form of an interest-free loan.
Learn More: Everything You Need to Know About Low-Income Home Loans
Best Federal Mortgage Options for Low-Income Buyers
The U.S. government also offers several attractive programs and grants, regardless of where you’re buying a home. Mississippi home buyers should explore these options along with state programs to find a suitable offer:
FHA loans are a popular option for first-time home buyers for many reasons. For starters, your credit score can be as low as 500 and still get approved for a loan (a 10% down payment is required if your credit score is lower than 580). If your credit score is at least 580, you only need to come up with 3.5% for a down payment.
203K Rehab Loans
A fixer-upper home could mean a lower purchase price, but it also means you’ll have to come up with the money to make repairs or renovations. The 203K rehab loan lets you borrow enough to cover the cost of the home and repairs and combines it into a single loan.
This loan is backed by the U.S. Department of Agriculture and requires no down payment. However, this means that you’ll be financing 100% of the home, which could make your monthly mortgage payment higher than if you’d put money down.
Learn More: The Complete Guide to FHA Loans By State
Best Private Lender Programs in Mississippi for Low-Income Home Buyers
Aside from state and federal programs, private lenders are eager to help low-income home buyers achieve their goals. Take a look at the most common private lending options:
Fannie Mae’s HomeReady mortgage is designed for low-to-moderate income earners and is available to first-time or repeat buyers. Buyers can use a variety of sources for the down payment, including gifts and grants, so your personal contributions are minimal.
If you’re a first-time home buyer, Freddie Mac’s HomeOne loan is designed for low-to-moderate income earners. You only need to put down 3%, and unlike other programs, there are no income or geographic restrictions.
How to Explore Your Financial Options
Whether you’re a first-time home buyer or are planning to move, evaluating your financial options is easier when you connect with a top-rated real estate agent. Your agent can provide guidance in terms of choosing a lender or mortgage and with the home-buying process at large.
In addition, your agent may be able to help you uncover additional cost savings through their expertise in timing the market, negotiations, and their professional network.
Clever Partner Agents are full-service agents in your local area that can help you explore the various financial programs in Mississippi. Connect with a Partner Agent today to learn how we can help you with the home buying experience and achieve an optimal outcome!