Florida Home Buyers Programs – Forbes Advisor

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If you’re a first-time home buyer in Florida, you don’t have to bear all the financial burden on your own. With the help of a few prime mortgage programs, there are ways to ease the stress and cost of buying a home.

Homeownership Programs for Florida Residents

There are different types of programs for first-time home buyers, from down payment assistance to government worker assistance. There are also local and regional programs as well as state-run initiatives.

Related: Best Mortgage Lenders First Time Homeowners

Florida Assist (FL Assist)

This program offers up to $10,000 in down payment assistance. Assistance can be applied to loans including through the Federal Housing Administration (FHA), Veterans Affairs (VA), United States Department of Agriculture (USDA), or conventional loan. It has a 0% interest rate and the loan is deferred until you sell your home, refinance it, or pay off your first mortgage.

Florida Homeownership Loan Program (FL HLP) Second Mortgage

This program also offers up to $10,000, but has a 3% interest rate and you’ll make monthly payments on top of your monthly mortgage payment. You will have to repay it within 15 years. For this reason, it counts in your debt-to-income ratio (DTI) as you go through the home equity underwriting process.

Housing Finance Agency (HFA) Programs

With HFA Preferred and HFA Advantage PLUS, you can receive 3%, 4% or 5% of the purchase price as a second mortgage. You can use it to help with your down payment or closing costs. The balance of the second mortgage is canceled during the five-year term.

Hometown Heroes Housing Program

This program provides up to 5% – and up to $25,000 – in down payment and closing cost assistance for eligible public service workers, including:

  • Firefighters
  • Educators
  • Health care workers
  • early childhood workers
  • active military
  • Veterans
  • law enforcement officers

Those who are eligible can expect lower interest rates on all eligible loans, including FHA, VA, rural development, and those offered by Fannie Mae and Freddie Mac. You can skip some upfront fees. Income and purchase price limits vary by county, and you will need to meet specific eligibility criteria to be eligible.

Partnership for State Housing Initiatives (SHIP)

SHIP provides funds to local governments for low-to-moderate income people in the state. All counties in the state receive funding from SHIP, but the amount varies by county. It provides a down payment and purchase assistance in the form of a 0% interest loan.

Local programs

In addition to state offerings, additional programs are offered at the city, county, and regional levels. Here are some examples.

  • Broward County: In Broward County, you can receive up to $40,000 as a deferred second mortgage. It has a 0% interest rate and must be repaid within 15 years. There are limits based on city, home sale prices, and income. The funding and approval process can take up to six weeks.
  • Fort Lauderdale: Fort Lauderdale, a city in Broward County, is not available in the county’s offering, but does have its own purchase assistance program. It offers down payment assistance of up to $75,000 and the loan has to be repaid in 15 years. Income limits determine eligibility.
  • Orlando: Orlando, Central Florida also offers a program based on income eligibility and you will need to qualify for a fixed rate mortgage before applying. If you meet the specific requirements during the lien period, the loan is forgiven.

Be sure to research local programs based on where you are moving to see if you are eligible for local homeownership programs.

First-Time Home Buyer Grants for Florida Residents

Some programs provide assistance that requires money to repay, but grants are gifts that you don’t need to repay. You might see interest-free or deferred payment loans, which generally only require repayment if you sell the home or refinance. Otherwise, the money is basically a grant.

Many cities, counties, and municipalities offer grants at the local and even regional level, including:

  • Pensacola: Get up to $30,000 down payment and closing cost assistance if you live in the city of Pensacola. There are income and credit requirements to qualify and you will need to make the property your primary residence. You may also be eligible for a grant from the City and County of Escambia for assistance of up to $12,500 through a separate homeownership program.
  • Miami Dade: The Miami-Dade County Economic Advocacy Trust (MDEAT) is offering up to $12,250, although you may be eligible for up to $95,000 from other down payment assistance programs in the county. The loan is canceled after 10 years as long as you stay in the house and do not refinance. There are income and property restrictions you must follow, and the program is aimed at low- to middle-income first-time home buyers.

Some of these programs are funded from the local budget or in conjunction with state programs. It’s important to see what’s offered in the cities and counties where you’re considering buying a home, as programs vary widely from place to place.

How to buy a house in Florida

Florida has one of the fastest growing real estate markets in the country. According to home-sales site Redfin, the median sale price in the state rose more than 17% year-over-year in July 2022 and now averages $410,900. The median sale price of homes in the United States was $402,400 at the end of July, according to the Federal Reserve Bank of St. Louis.

Even with high housing costs, you can still prepare now to buy a home. Here are some key steps:

  1. Prepare your file. You will need specific documents and forms, including recent tax documents, bank statements, etc. It can be helpful to save a folder on your computer with everything you need, especially since most mortgage applications start online. You might also consider saving documents to the cloud so you have quick access if a mortgage underwriter requests an important document when you’re away from your home computer.
  2. Review your credit score and history. Get your free credit report from major credit bureaus at AnnualCreditReport.com. See if there are any errors you can correct. If you have an outstanding debt, pay it off as soon as possible. And don’t ask for new debt when applying for a mortgage, as it could hurt your score.
  3. Get pre-approved. Work with a trusted lender or broker to get pre-approved for a mortgage. A pre-approval tells you how much home you can afford and reassures the seller that you have financial backing. Also, just because you’re approved for the maximum amount doesn’t mean you should buy a home at the top of your budget. You can get pre-approved from many lenders in a short period of time without triggering multiple credit checks each time.
  4. Find a real estate agent. Ask friends and family members to recommend agents in your area. Find one that works specifically in the neighborhoods you’re considering. Have criteria in mind, such as whether you need an updated kitchen or places without a homeowners association, as these incur additional monthly fees.
  5. Find your house. Try to avoid becoming attached to one place and instead find several that meet your wants and needs. Keep in mind that sellers like to see a pre-approval letter because it means you’re serious about buying the property, not just browsing.

If you’re struggling to afford a home in Florida, consider taking advantage of these different programs. Keep in mind that some programs can delay the home buying process, so only do this if you have time to apply and wait for approval. If you need a home right away, these homeownership programs might not be right for you.

Related: Mortgage repayment calculator

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