Ohioans and Americans alike might be surprised to learn that Ohio is the seventh most populous state in the country. Ohio is often overlooked, but residents throughout Cincinnati, Columbus, and Cleveland see growth happening throughout the state. Whether you were born in Ohio or arrived for a high-quality college education, it’s hard to deny how quickly Ohio can feel like home.

Are you ready to settle down and call Ohio your permanent home? Buying your first house is certainly an exciting process. From the housing market to loan options, we want to help you through every step of the process. Use this guide to start shopping for loans, planning your purchase, and enjoying your big move in Ohio.

The Future of Ohio’s Housing Market

Columbus has taken the silver medal for the hottest housing market in America, trailing just behind Midland, Texas. The number of available homes throughout the region is down 13.1% from the previous year.

This means that you need to act fast if you want to purchase a home in Central Ohio, especially since there are limited homes available. If you want to be strategic, however, many economists are predicting a market slowdown in late 2019.

In fact, 2019 may be the best time for buyers in terms of competition. The other side of the coin reveals that mortgage rates may continue to rise throughout the new year. Buyers who are looking at adjustable-rate mortgages may want to opt for a fixed-rate that is more predictable as the market potentially comes to a halt.

Mortgage Options for First-Time Homebuyers in Ohio

Let’s talk about home loans and mortgages, shall we? First-time homebuyers have a lot of options when shopping for loans. Many loans offer relaxed terms for first-time homebuyers or require that borrowers use the loan for an owner-occupied home.

Federal and Conventional Loans

Buyers across the country may choose a federal or conventional loan to purchase a house. They choose these loans because they tend to be the most forgiving. They also offer young buyers an affordable 30-year fixed-rate mortgage without high credit score requirements. Income and purchase-price limits will vary.

Remember, your credit score will not be affected for looking at different loan options.

The most common federal loans are FHA, VA, USDA, and conventional mortgage loans. Ohio buyers can also apply for similar loan programs through the Ohio Housing Financing Agency (OHFA.)

Loan Assistance Programs for First-Time Home Buyers in Ohio

Ohio has a variety of loan assistance programs geared toward first-time home buyers. Veterans, recent college graduates, and buyers who need down payment assistance can all find a program that works for them.

Ohio Your Choice!

Ohio Your Choice! is a down payment assistance program that can help buyers pay a 2.5% or 5% down payment at closing. Buyers who keep their home within seven years can apply to have their assistance forgiven. This program comes with higher interest rates and should be considered if buyers plan to stick around for a long time.

OHFA Advantage Grants

OHFA offers grants to homebuyers with a low to moderate income who need additional assistance with their down payment and closing costs. Like many Ohio loan programs, buyers can use OHFA loans in addition to assistance from Ohio Your Choice! assistance.

Ohio Heroes

Like the VA loan program, Ohio Heroes helps veterans get a discounted mortgage rate. Unlike the VA loan program, Ohio Heroes is also available to grade school teachers, firefighters, EMTs, paramedics, and other medical professionals. Qualified buyers can use an Ohio Heroes discount alongside down payment assistance.

Ohio Grants for Grads

Want to frame your new degree in a house decked out with Buckeyes swag? Look into the Ohio Grants for Grads program. Qualified buyers can get a discounted interest rate and down payment assistance that is forgiven after five years of settling into your Ohio home.


(Lenders may refer to this loan as an FHA 203(k) loan.) If you want to buy a fixer-upper, consider the RenovateOhio program. RenovateOhio finances the initial home purchase and the costs of renovations with a long-term, fixed-rate mortgage. Buyers cannot combine this program with OHFA federal tax credits.

Buyers can explore a more comprehensive list of loan assistance programs, including regional and local programs, on the U.S. Department of Housing and Urban Development website.

What are Ohio mortgage credit certificates?

Mortgage credit certificates can help first-time homebuyers lower their monthly mortgage payments with a tax credit. Certificate holders can receive up to $2,000 back on their tax return through a tax credit of up to 40% of interest paid on the buyer’s mortgage that year. Ohio mortgage credit certificates can assist buyers for up to 30 years if they continue to qualify and keep their home as their primary residence.

In order to qualify, buyers will have to owe an outstanding balance after filing their tax return. Tax credits are available for buyers with or without an OHFA mortgage, but buyers with an OHFA mortgage can receive extra assistance. Other criteria include:

  • Income and purchase price limits
  • Credit score requirements
  • DTI ratio

Additional Tips for First-Time Home Buyers

  • Check (and take steps to improve) your credit score. Buyers can find a loan with a credit score as low as 500. Fortunately, if they have time to increase their score, they can increase their chances of getting a more affordable loan. Pay off balances on your credit cards and student loans, check for errors, and diversify your credit to make yourself look more trustworthy to lenders.
  • Look into homebuyer education courses. Once buyers have submitted a loan application, they can take a free homebuyer education course through HUD. This course will help buyers understand more about the home buying process, how to create a healthy budget, and what buyers can do if they need additional assistance down the road.
  • Find a real estate agent that you can trust. It is just important to shop for buyer’s agents as it is to shop for houses! Buyer’s agents can help you prepare for your first home purchase and get you the best deal on the home of your dreams.