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Today’s Rates for First Time Homebuyers in North Carolina

Friday, May 17, 2024

Mortgage rates are at 3.00% for the 30 year fixed loan program and at 2.56% for the 15 year fixed. As for variable rates, the 5/1 ARM rate currently stands at 4.56%. Check out FHA and VA rates as well if you are doing low or no down payments.

North Carolina First Time Home Buyer Checklist

  1. Consider various program options. If you're moving to a USDA eligible area, you may qualify for a zero down payment loan through USDA. Veterans and active duty personnel may be qualify for VA loans, which do not require cash down. 
  2. Know your credit score. Your credit should be somewhere above 600, but some lenders like subprime lenders accept scores in the 500s. If your credit score needs a boost, work on improving it before you try to take out a mortgage. Once annually, you're able to request a free credit report from the three major credit bureaus, Equifax, Experian or TransUnion. 
  3. Compare interest rates from a handful of lenders in your part of North Carolina. Choose one who not only provides a great offer, but carries a high rating from the Better Business Bureau.
  4. Once you've picked a lender, it's time to get pre-approved or pre-qualified for a loan. Provide income documentation with your last two pay stubs and tax returns from the past two years. 
  5. Calculate your true affordability. You could be pre-approved for a loan amount that is larger than you had anticipated, but do not base affordability solely on the sum provided. Only you know your monthly spending habits.
  6. Time to go home shopping. In the meantime, do not make any extravagant purchases, take out new installment loans, or do anything that could hurt your financial standing. Lenders will check your accounts again before closing your loan.  

Low Down Payment Loans Through FHA

If you’re a first time home buyer without a lot to put down, a North Carolina FHA loan may accommodate you. FHA loans are backed by the government and designed to help home buyers with limited upfront funds receive financing.

  • Down payment: 3.5%
  • Minimum acceptable credit score: 580 (varies)
  • Mortgage insurance: Upfront (1.75% loan amount) and monthly
  • Property guidelines apply and are verified via home inspection

You can find additional information about FHA loans on the North Carolina page of the FHA website.

No Down Payment Loans Through USDA

The United States Department of Agriculture backs home loans for zero down to North Carolina home buyers looking to move to or live in rural areas. Find out if your buying city is eligible by searching the USDA's property map. Note that popular areas like Charlotte, Greensboro, and Asheville are not eligible. 

  • Down payment: None required; financing up to 102% available depending on home appraisal
  • Minimum acceptable credit score: 620
  • Mortgage insurance: Upfront (2% loan amount) and monthly
  • Income maximums apply 

North Carolina Grant and Assistance Programs

The North Carolina Housing Finance Agency, or NCHFA, provides an affordable loan, including optional down payment assistance, through the N.C. Home Advantage Mortgage. The program offers competitive 30 year fixed-rate home loans financed through FHA, USDA, VA, and conventional programs. Down payment assistance of up to 3% the base loan amount is available via the facilitation of a short second mortgage. Participant salaries must not total more than $85,000 per year, and a 640 minimum credit score is required. 

North Carolina first time home buyers can benefit from a lower federal tax withholding each paycheck by participating in the Mortgage Credit Certificate (MCC) program. Total annual savings can be as much as $2,000.

These programs are even available in popular areas like Charlotte and Asheville. To find out more about your eligibility, visit the  NCHFA mortgage page

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