Ohio First-Time Home Buyer Programs of 2023
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If you are a first-time home buyer in Ohio, there's help to make homeownership more affordable. The state of Ohio works with mortgage lenders to offer home loans to people with low and moderate incomes, including first-time home buyers. You’re considered a first-time buyer if you haven’t owned a residence within three years.
The Ohio Housing Finance Agency, or OHFA, helps with 30-year fixed-rate conventional loans, as well as mortgages from the Federal Housing Administration, Department of Veterans Affairs and U.S. Department of Agriculture. These government-backed loans have relaxed income and purchase price limits and can be combined with other assistance.
Here’s what to know about national and state programs available in Ohio and what you need to qualify.
OHFA highlights and eligibility requirements
OHFA has a number of programs that assist first-time buyers and others buying a home. Benefits include lower mortgage rates, down payment assistance, tax credits and combined financing for buying and renovating a home. Not a first-time buyer? You may find help from Ohio’s Next Home program.
Highlights
Down payment assistance forgivable after seven years.
Mortgage tax credits available.
Incentives for recent college grads, military, first responders, teachers and health care workers.
Eligibility
Minimum credit score of 640, may be higher for FHA loans.
Free home buyer education required.
Limits on debt-to-income, purchase price and borrower incomes.
First-time buyer requirement waived for eligible veterans or to purchase homes in target areas.
» MORE: Tips for first-time buyers
Ohio first-time home buyer loan programs
Ohio Your Choice! Down Payment Assistance
Best for:
Cash assistance you might not need to repay
What you need to know:
First-time home buyers and repeat buyers may qualify for down payment assistance of either 2.5% or 5% of the home’s purchase price. The larger assistance amount comes with a higher interest rate. You can use the money toward your down payment, closing costs or other qualifying “pre-closing” expenses. After seven years, the financial assistance is forgiven. If you sell or refinance before that, you’ll have to repay the money.
Ohio Heroes
Best for:
Assistance for those who serve the public
What you need to know:
Ohio Heroes offers discounted mortgage rates to eligible first-time and repeat buyers who are members of service professions, including veterans, active-duty military members or reservists (surviving spouses included), police, paid and volunteer firefighters, emergency medical technicians, paramedics, physicians, nurse practitioners, registered nurses, licensed practical nurses, state-tested nurse aides, and pre-K through grade 12 teachers, administrators and counselors. You can combine a Heroes discount with down payment assistance.
Ohio Grants for Grads
Best for:
Assistance recent college graduates might not need to repay
What you need to know:
Recent graduates may be eligible for two homebuying incentives designed to keep them in Ohio after college. You’re eligible if you’re a first-time buyer and if, within the past 48 months, you earned an associate, bachelor’s, master’s or doctoral degree from an accredited school recognized by the U.S. Department of Education.
The program offers a discounted mortgage interest rate that can be combined with down payment assistance of 2.5% or 5% of the home’s purchase price. The assistance is forgiven after five years unless you sell the home and leave Ohio before then, in which case you’ll need to repay some or all of it.
Ohio Mortgage Tax Credit
Best for:
A break on your taxes
What you need to know:
First-time home buyers may be eligible for a mortgage credit certificate if they meet income and purchase price guidelines. The certificate allows a tax credit of up to 40% of the borrower’s annual mortgage interest paid, with a maximum of $2,000. Your credit can’t be more than you owe after deductions, exemptions and other credits. Borrowers using the tax credit also can get down payment assistance amounting to 2.5% of the home’s purchase price.
Start learning about OHFA first-time home buyer programs at the agency’s website. You’ll find details on income and purchase price limits, and links to lenders that are acquainted with these programs and their requirements.
Not a first-time buyer? You may find help from Ohio’s Next Home program.
First-time home buyer programs near Ohio
National first-time home buyer programs
These national mortgage programs may be used by first-time home buyers to make home-owning more affordable in any of the 50 states.
Conventional mortgage
Best for:
Low down payments, limited mortgage insurance premiums
What you need to know:
A conventional mortgage is a home loan that isn’t guaranteed or insured by the federal government. Conventional mortgages that conform to the requirements set forth by Fannie Mae and Freddie Mac allow down payments as low as 3% for first-time buyers or lower-income home buyers. Unlike FHA loans, conventional loans allow borrowers to eventually cancel their mortgage insurance or avoid mortgage insurance altogether if they put at least 20% down.
VA loans
Best for:
Military, low down payments
What you need to know:
The U.S. Department of Veterans Affairs helps service members, veterans and surviving spouses buy homes. VA loans are especially generous, providing competitive interest rates, often requiring no down payment or mortgage insurance. Although there is no official minimum credit score, most VA-approved lenders require scores of at least 640.
FHA loans
Best for:
Low credit score, low down payments
What you need to know:
This is the go-to program for many first-time home buyers with lower credit scores. The Federal Housing Administration allows down payments as low as 3.5% for those with credit scores of 580 or higher. The FHA will insure loans for borrowers with scores as low as 500 but requires a 10% down payment for a score that low. Mortgage insurance is required for the life of an FHA loan and cannot be canceled.
USDA loans
Best for:
Low down payments, rural home buyers
What you need to know:
A USDA home loan is a zero-down-payment mortgage for eligible rural and suburban home buyers. USDA loans are issued by the U.S. Department of Agriculture through the USDA Rural Development Guaranteed Housing Loan Program. There are income limitations, which vary by region. Applicants with credit scores of 640 or higher receive streamlined processing. Those with scores below that must meet more stringent underwriting standards.
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