What You Need to Know as a First-Time Home Buyer

Sacramento CA Real Estate Podcast with Thomas March

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What You Need to Know as a First-Time Home Buyer

The Sacramento real estate market has changed dramatically in the past year. We are seeing a lot more inventory on the market, as well as historically low interest rates. This surge in market activity has had us talking to a lot of first-time home buyers lately. Deciding to purchase your first home is a big step, and there is a lot of information you should be aware of. That is why we are joined today by our preferred lender Doug Jones. Doug is going to talk to us about some great programs that are out there, designed for first-time home buyers.

There are some great programs out there right now for first time home buyers in the finance world. A lot of programs that require little down payments. There are a lot of reasons to put a small down payment on a home, but for first time home buyers, it's because you don't quite have the cash reserves to put $20,000 down on a home.

There are 2 primary options that offer low down payment plans for 30-year fixed mortgages. FHA financing allows you to get into a home with just a 3.5% down payment. Conventional financing requires a minimum 5% down payment.


The other 2 options are a little more complex. With VA financing, you aren't required to pay any down payment, but the catch is you will need to be either active-duty or retired military or national guard. If you have a document called the DD214, you are all but guaranteed a VA loan with 0% down.

Another program is USDA. This is a rural program for unincorporated areas such as Lincoln, Loomis, and parts of Auburn. Those allow a small down payment as well.

Another question that we get a lot from first time home buyers is what kind of down payment assistance we can offer. We can offer some great down payment assistance programs through CHDAP, or the California Housing Down Payment Assistance Program. This program is designed to be combined with an FHA loan to bring down the payment to between 1/2% and 1%.

For conventional financing, while CHDAP doesn't lower the down payment from 5%, it allows you to use 3% of that 5% to cover closing costs. There are definitely a lot of great programs out there for first time home buyers.

If you have any questions about mortgages, or about anything else real estate related, feel free to give us a call or send us an email. We would be more than happy to assist you!