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First Time Home Buyers Florida: Mortgage Options

Updated: Mar 14

Mortgage Options Florida
Florida Mortgage Options

First Time Home Buyers Florida

Buying a home is one of the most important decisions you will make in your life. The process can be overwhelming and confusing. I have helped many first time home buyers understand the mortgage loan options available to them, so they could buy their dream homes at great rates and terms.

Our website is full of information to get started on your buying journey including Florida down payment assistance programs for first time home buyers, conventional loans with only 3% down, FHA loans with only 3.5% down or VA 100% financing which are perfect for veteran borrowers.

It's important to start your mortgage shopping early in order to understand the different types of programs available for first time home buyers and determine which loan program best fits your needs.

These first time home buyers and government loan programs are always worth consideration. If flexibility is what you need or if a low down payment would fit your budget best, take advantage of the benefits that these programs have to offer.

Fannie Mae 97% LTV Conventional Mortgage Loan

The 97% LTV mortgage loan option offered by Fannie Mae is a great solution for first time buyers that do not have much saved up or who want to make a small down payment so their money can be invested in other places.

The Fannie Mae 97% LTV mortgage program offers several key features.

Product Highlights:

  • Credit scores as low as 620

  • Down payments as low as 3%

  • Cancellable mortgage insurance after 20% Equity or 80% LTV

  • At least one borrower must be first time home buyer when down payment is less than 5%

  • Homebuyer education is required for at least one borrower only if all occupying borrowers are first-time homebuyers

  • Primary Residence

  • Fixed –15 & 30-year terms

  • 1-4 unit, PUDs, condo & manufactured

  • Non-Occupant co-borrower allowed at 95% LTV

  • No income limits

  • Flexible sources of funds 1 unit: 100% gift allowed

Fannie Mae HomeReady Loan Program

HomeReady loans are a special product available from Fannie Mae designed for low-moderate income borrowers. They can be used to purchase 1 unit homes, condo’s and manufactured housing units with flexible funding sources.

The goal of the Fannie Mae HomeReady mortgage is to provide creditworthy low-to-moderate income households an opportunity to overcome the obstacles to homeownership by providing them a fixed rate loan with more flexible underwriting requirements.

The HomeReady mortgage features key elements that make it appealing for first time home buyers that are facing financial challenges, such as no income restrictions in low-income census tracts, and a 30 year fixed rate mortgage product that offers stability for borrowers.

Borrower Benefits:​

  • Lower monthly payment due to lower rates and mortgage insurance

  • Down payment options as low as 3% with flexible sources of funds

Product Highlights:

  • Credit scores as low as 620

  • Borrowers with credit score 680+ may get better pricing

  • Cancellable mortgage insurance

  • Mortgage insurance coverage is only at 25%

  • Borrower is not required to be a first-time buyer

  • Homebuyer education is required

  • No reserves required

  • Income limits 80% of area median income (Area Medium income look up tool)

Freddie Mac HomeOne Conventional Loan Program

The Freddie Mac HomeOne mortgage is a low down payment option for first-time homebuyers and no cash-out refinance borrowers.

This mortgage solution will help more first-time home buyers achieve their dream of homeownership, regardless of their income levels or geographic location. Home One reflects Freddie Mac's dedication to responsible lending, sustainable homeownership and improving access to credit.

With more flexible payment options, HomeOne provides increased opportunity and greater levels of certainty for first time home buyers.

The Freddie Mac HomeOne mortgage program offers a range of key features

Product Highlights:

  • Credit scores as low as 620

  • Down payments as low as 3%

  • Cancellable mortgage insurance after 20% Equity or 80% LTV

  • At least one borrower must be first time home buyer when down payment is less than 5%

  • Homebuyer education is required for at least one borrower only if all occupying borrowers are first-time homebuyers

  • Primary Residence

  • Fixed –15 & 30-year terms

  • 1-4 unit, PUDs, condo & manufactured

  • Non-Occupant co-borrower allowed at 95% LTV

  • No income limits

  • Flexible sources of funds 1 unit: 100% gift allowed

VA Loans

If you are an active or veteran service personnel , then the VA Loan program is for you. These government-backed loans have a low down payment and flexible guidelines that offer lower interest rates.

The VA loans help Servicemembers, Veterans, and eligible surviving spouses become homeowners. The VA Loan provides home buyer assistance in order to allow veterans to buy a house, build one, or fix one for their own personal occupancy.

VA Home Loans are facilitated through private lenders. The VA ensures the loans, enabling the lender to provide veterans with more favorable terms by taking on less risk.

Veterans and their families have access to mortgage options such as 100% financing with no requirement for mortgage insurance when leveraging a VA loan. As such, veterans are able to purchase a home in an area that they can afford with easy financing should their duty station change or they retire!

The VA loan has many benefits for veteran homebuyers.

Program highlights & benefits:

  • Up to 100% financing available

  • Fixed rates available

  • Not limited to first time home buyers

  • Purchase and refinance options

  • No mortgage insurance required

  • Credit scores as low as 540

  • Conforming and high balance loan limits apply

  • Manufactured homes available

Who can use a VA loan?

  • Active duty military

  • Veterans with honorable discharge status

  • Reservists

  • National Guard

  • Dual military (both spouse completing service)

  • Spouse of active or retired military/veteran


FHA Loan

A Federal Housing Administration (FHA) loan is a mortgage program that is insured by the federal government through the FHA and issued by an FHA-approved lender. They are designed for low-to-moderate income borrowers, they require a lower minimum down payment, they have a lower credit score requirement, and have broader eligibility levels than conventional loans.

To reduce risk, the FHA insures loans issued by lenders, like banks, credit unions and non-banks. That insurance protects these institutions in case of default, which is why lenders are willing to offer favorable loan terms to borrowers who might not otherwise qualify for a home loan. Only an FHA-approved lender can issue an FHA-insured loan.

An FHA home loan can be used to buy or refinance single-family houses, two- to four-unit multifamily homes, condominiums and certain manufactured homes.

The FHA loan helps home buyers get approved for more by allowing a higher debt to income ratio (DTI) than conventional mortgage loans.

With relaxed student loan guidelines from the Department of Housing and Urban Development (HUD), homeowners now have an easier time qualifying for a FHA Loan.

FHA loans have many benefits that are ideal for first-time homebuyers.

Product Highlights:

  • 3.5% down payment

  • Primary residence only

  • Purchase and refinance options available

  • Credit score as low as 540

  • 1-4 units, PUDs, manufactured homes & FHA Approved Condos accepted *Credit scores below 580 require 10% down payment.

Florida Down Payment Assistance

As the rental market has become less appealing, many Floridians are considering buying a home instead of leasing. The process can be overwhelming, especially if you do not sufficient funds for the required down payment and closing cost.

People who want to purchase a home in Florida but are lacking the financial resources have several assistance programs at their disposal through the Florida Housing Finance Corporation (FHFC), which aids people with down payments and closing costs. These assistance programs are offered by the Florida housing and issued by approved lenders.

Florida housing approved lenders are able to offer a secondary mortgage program that allows eligible borrowers in Florida to use the funds for down payment and closing cost, or as part of a principal reduction on the first mortgage. These mortgages are not stand alone.

1. Florida Assist Mortgage Program (FL Assist)

Up to $7,500 assistance for conventional loans

Up to $10,000 assistance for FHA, VA and USDA-RD loans

The Florida assist mortgage program has a 0% interest rate, it is non-amortizing, and deferred second mortgage, this means that it does not carry a monthly payment and does not negatively effect your debt to income. The Florida assist second mortgage is not forgivable. Repayment is deferred, except in the event of the sale, transfer, satisfaction of the first mortgage, refinancing of the property or until such a time the mortgagor ceases to occupy the property at which time, the Florida Assist second mortgage becomes payable in full. The FL Assist cannot be combined with any another Florida Housing down payment programs.

2. HFA Advantage Plus & HFA Preferred Plus Forgivable second mortgage.

The HFA advantage Plus and the HFA Preferred Plus secondary mortgage programs are five-year, non amortizing, deferred loans that are forgiven at the rate of 20% per year counting from the day of loan closing, the loan is fully forgiven after 5 years, provided the borrower is not in default. There is no pro-rata forgiveness.

These Florida housing loan programs provide first time home buyers with 3% 4% or 5% of the total loan amount to be used towards down payment and or closing costs.

Example: Loan amount $300,000 you can be eligible for up to $15,000 in down payment assistance.

The PLUS Second Mortgages cannot be combined with any other Florida housing down payment program. The PLUS Second Mortgages carry no monthly payment. The balance will become payable in full if the client decides to sell, transfer, satisfy the first mortgage, refinancing the property or stop using the property as primary residence within the first five years of the loan.

Minimum requirements:

  1. 640 credit score

  2. 2- years steady work history

  3. Max house hold income requirements per county

  4. Max purchase limits requirements per county

  5. Credit scores 640-679 max debt to income ratio is 45%. Credit scores above 680 max debt to income is 50%

  6. Must be a first time home buyer

Program Benefits:

  • State wide

  • Can be used for down payment and closing cost

  • Conventional, FHA, VA, & USDA Options

  • Up to $10,000 deferred option (Dormant second lien, 0% interest, no monthly payments)

  • Up to 5% of purchase price forgivable option ( 0% interest, 5 years deferred forgiven at 20% per year, fully forgiven after 5 years)

The decision to buy your first home is a big one, but it can be much easier with the help of an expert. Whether you’re looking for conventional loans or those that are insured by the VA or FHA, I am ready to connect and provide guidance on which loan option will work best for you.

If you are ready to to take the leap in to home ownership, visit my online application and and start your pre-approval process today.

If you have any questions about your specific scenario you can set up an initial phone consultation for the day and time that works best for you! I would love to talk through all of the loan options available and find the perfect one for you.

Learn about your home loan options as a first time home buyer in Florida
First Time Home Buyers Florida

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