Buying a home in Arizona feels like a dream come true. However, the process of buying a home requires a lot of time and effort. You also need to source for funds that you can use to make the dream come true. Are you stuck and wondering how to finance your dream of buying a home? You may want to consider the best Arizona home buying programs.
Arizona home buying programs started with the aim of helping Americans access affordable housing. Thus, through the best Arizona home buying programs, you can achieve your dream of owning a home.
So, why are Arizona home buying programs the best when it comes to buying a home? We look at some of the reasons why Arizona home buying programs are the best when it comes to buying a home.
1. Require Little To No Down Payment
Are you dreaming of buying a house in Arizona, but the down payment seems like an insurmountable hurdle? You are not alone! Almost 70% of home renters say they cannot purchase a home due to a pricey down payment. To overcome the barrier, Arizona home buying programs provide buyers low to no down payment mortgages. Thus, you can achieve your dream of homeownership through the different options. Here is an overview of Arizona home buying programs that support buyers through no or low down payment mortgage.
- USDA Home Loan: Backed by the United States Department of Agriculture, this is a no down payment mortgage option. The mortgage is available to buyers who are want to purchase a home within the specified areas.
- The VA Home Loan: This is another no down payment mortgage. The VA home loan is backed by the United States Department of Veteran Affairs and supports veterans’ active service members and qualifying spouses to buy a home in Arizona.
- FHA Home Loan: Guaranteed by the Federal Housing Administration, the home loan is available for those who can afford a down payment of just 3.5%.
- Conventional Loan 97%: the loan is available from Fannie Mae and Freddie Mac and offers mortgage loans at just a 3% down payment.
Therefore, if a high down payment is keeping you from owning a home, you can check whether you qualify for either of the above home loan options.
2. Friendlier Credit Score Requirement
Another hurdle experienced by a majority of Americans who are hoping to own a home one day is the high credit score requirement. Prospective homebuyers should aim to have a high credit score to qualify for the conventional home loan. While the mortgage lenders require that you have a good credit score to qualify for the home buying programs, these home loans have friendlier terms regarding the credit score requirements. Here is an overview of the credit score requirements on various Arizona home buying programs:
- FHA home loan: The FHA home loan requires a minimum credit score of 580. However, borrowers with a credit score of below 580 can still borrow a mortgage so long as they can raise a down payment of 10% or above.
- USDA home loan: most lenders require a FICO score of 640 for the USDA home loan. However, some lenders will go down to 580.
- VA Home loan: Unlike the other Arizona home buying programs, the VA does not impose a minimum credit score requirement.
Therefore, if a low credit score is stopping you from buying a home of your dreams, Arizona home buying programs can get you back on track.
3. Lower interest rates
As we mentioned, Arizona home buying programs started as an initiative to allow more Americans to own a home. Apart from ensuring low down payment and friendlier credit score requirements, home buying programs provide lower interest rates. Thus, these options are much friendlier than conventional home loans. FHA and VA home loans offer lower interest rates because they are government-insured home buying programs. Therefore, borrowers attain significant savings through low-interest rates.
4. Roll Your Closing Costs Into The Loan Balance
VA home loan allows borrowers the option of 100% financing. Therefore, the borrower can roll the closing costs into the loan balance and pay the closing costs monthly.
Key Takeaway
Buying a home in Arizona becomes much easier through Arizona home buying programs. This is through access to lower down payment requirements, lenient credit scores, and affordable interest rates. Talk to your mortgage broker for advice on the different Arizona home buying programs.