Best First Time Home Buyer Programs in Idaho

If you live in Idaho and you’re hoping to buy a home, you’re in luck. Homeownership can seem out of reach, especially in today’s market. But you can consider several first-time home buyer programs in Idaho. Combined with nationwide programs, there’s a good chance you’ll find options that can help you buy a home. Take a look and see what might work for you.

Quick Look: Best First-Time Homebuyer Programs in Idaho

• HFA Advantage Loans (Fannie Mae)
• HFA Preferred Loans (Freddie Mac)
• Idaho Housing First Loan
• Idaho Housing Idaho Heroes Loan
• Idaho Mortgage Credit Certificate
• Idaho Housing Second Mortgage
• Idaho Housing Forgivable Loan

Quick Look: Best National First-Time Homebuyer Programs

• Best National FHA ender: Rocket Mortgage® by Quicken Loans®
• Best National VA Lender: Veterans United
• Best National USDA Lender in Idaho: Fairway Independent Mortgage Corp.

Best First-Time Homebuyer Programs in Idaho

Each state has a department to manage its housing. Idaho just happens to have a department that offers several useful first-time homebuyer programs. 

HFA Advantage Loans (Freddie Mac)

Freddie Mac HFA Advantage loans are a conventional mortgage product available exclusively through housing finance agencies (HFAs). These loans help make homeownership more attainable for low-income and moderate-income borrowers. They’re ideal for first-time homebuyers but can also be available for other borrowers. 

Key features:

• Loan-level credit fees are waived for HFA borrowers.
• Financial assistance may be available for closing costs and/or down payments.
• Lower minimum down payment requirements.
• Lower mortgage insurance costs. 

Requirements:

• At least one borrower must use the property as their primary residence.
• Down payment requirements can vary but tend to be 3% for a single-family home.
• Credit score requirements can vary but are usually a minimum of 620. 
• The debt-to-income ratio may vary but is usually 45%. 

HFA Preferred Loans (Fannie Mae)

HFA Preferred Loans are a low down payment mortgage product available from Fannie Mae. These loans are available only through eligible HFAs as well as approved lenders in their network. Like HFA Advantage Loans, they’re designed to make homeownership more attainable for low-income and moderate-income borrowers. 

Key features:

• Down payment assistance is often available.
• Reduced mortgage insurance requirements. 
• Flexible borrower income limits based on your local HFA.

Requirements:

• The property must be used as the borrower’s primary residence.
• Only available for fixed-rate mortgages with terms between 15 and 30 years.
• Borrowers must contribute at least 3% if the property is a two- to four-unit home. 

Idaho Housing First Loan

The Idaho Housing First loan is a tax-exempt mortgage option available to buyers in Idaho. It offers low interest rates that can help reduce monthly mortgage premiums. These loans are always serviced in Idaho and can be combined with other benefits through Idaho Housing and Finance.

Key features:

• Interest rates are as much as 1% lower than other loan programs.
• Down payment and closing cost assistance available.
• Can be used with conventional and other loan types, including those backed by the Federal Housing Administration (FHA) and Veterans Affairs (VA).

Requirements:

• County-specific first-time homebuyer requirements.
• Income and sales price limits set by Idaho Housing and Finance.
• Homebuyer education may be required.

Idaho Housing Idaho Heroes Loan

The Idaho Housing Idaho Heroes Loan offers mortgage financing to Idaho’s essential employees. This includes healthcare professionals, firefighters, law enforcement officers, paramedics, teachers, military personnel and retail workers. It is a new program that came out of the COVID-19 pandemic and has helped many Idaho residents achieve homeownership. 

Key features:

• Low interest rates available with conventional, FHA, VA and U.S. Department of Agriculture (USDA) loans.
• Offers repayable down payment and closing cost assistance.
• May offer gifted closing cost assistance of up to $1,000 through the Foundation Partnership Grant.
• May offer low or no mortgage insurance options.

Requirements:

• Homebuyers must complete homebuyer education classes.
• Buyers must have a minimum credit score of 620. 
• Homebuyers must make less than $110,000 annually.
• Buyers must be Idaho residents and essential workers.
• County-specific home type, purchase price and income restrictions may apply.

Idaho Housing Mortgage Credit Certificate (MCC)

The Idaho Housing Mortgage Credit Certificate (MCC) is a federal program that allows homebuyers to reduce the amount of federal income tax they owe. It was designed to help low-income and middle-income families who are also first-time homebuyers. The MCC tax credit is equal to 20% of the mortgage interest that is paid during the year. It can be claimed for up to 10 years. 

Key features:

• Reduces federal income tax liability.
• The credit is fully refundable, meaning homeowners can receive the refund even if they don’t owe any federal income tax. 
• Available in all Idaho counties.

Requirements:

• For a family of three or more, the borrower’s annual gross income must not exceed 115% of the area’s median family income.
• For a family of one or two people, the borrower’s annual gross income must not exceed 100% of the area’s median family income. 
• Only available for single-family residences being used as the borrower’s primary residence.
• The home’s acquisition cost must not exceed 90% of the average area purchase price, with an exception for targeted counties.
• Borrowers must complete an online homebuyer’s class.
• Borrowers must acquire a new mortgage or home loan and meet the credit and underwriting criteria set by the participating lender.

Idaho Housing Second Mortgage

An Idaho Housing Second Mortgage is one of Idaho’s down payment and closing cost assistance programs. Borrowers can use it for down payment and closing cost assistance for their home purchase. This program can make homeownership more attainable by reducing the cost of closing on a home. 

Key features:

• Can be paid back in small increments alongside the primary mortgage.
• Comes with a low fixed interest rate.
• Comes with a fixed term of 15 years.

Requirements:

• There are income limits of $150,000 in some cases.
• Borrowers must contribute at least 0.5% of the sales price out of pocket for the purchase transaction.
• Borrowers are required to complete Finally Home!® Homebuyer Education. 

Idaho Housing Forgivable Loan

The Idaho Housing Forgivable Loan is another of Idaho’s down payment and closing cost assistance programs. It is available to first-time homebuyers as well as repeat homebuyers. The program offers a loan that is gradually forgiven over time, making it a good option for borrowers looking to make purchasing a home more affordable. 

Key features:

• Has 0% interest.
• Available for up to 3% of the home’s sale price.
• A tiered forgiveness of 10% per year.

Requirements:

• Requires a lien to be placed on the property.
• Borrowers must contribute at least 0.5% of the sale price out of pocket for the purchase transaction.
• Borrowers are required to complete Finally Home!® Homebuyer Education. 

Best National First-Time Homebuyer Programs

If you’re an Idaho resident, you’re fortunate to have state-specific programs available to you. However, there are national first-time home buyer programs that are worth looking into as well. 

FHA Loans

FHA Loans are offered through the Federal Housing Administration (FHA). These loans offer low down payments, low closing costs and lower credit score requirements. They can be especially useful for first-time homebuyers who are looking to purchase either a single-family home or a multifamily property of up to four units. 

Best National FHA Lender: Rocket Mortgage® by Quicken Loans®

Rocket Mortgage is an online lender that offers purchasing and refinancing products. The company offers quick online approvals as well as several tools and resources to help potential homebuyers prepare for home ownership. The company’s team of home loan experts can work with you to help you find the best mortgage product and be there with you through the process.

Minimum credit score: 580 

Requirements: 

• Can only be used for primary residences.
• The borrower must move into the home within 60 days of closing.
• The home must be appraised by an FHA-approved appraiser and must pass an inspection.
• A minimum down payment of 3.5%

VA Loans

VA loans are government-backed mortgages that are available exclusively to military service members, veterans and their surviving spouses. These mortgages can be used to purchase a variety of home types, including single-family homes, multiunit properties and new construction. There are several benefits to this loan program, including no required down payment and flexible credit guidelines. 

Best National VA Lender: Veterans United

Veterans United is a lender that is dedicated to military families and veterans. The company offers homebuyer education and an easy-to-navigate process to help its community achieve homeownership. Veterans United works directly with military advisers to help spread the word about VA loans and connect with customers. 

Minimum credit score: 600

Requirements: 

• Borrowers must meet eligibility requirements, including length of time in service. 
• Income requirements vary but typically require veterans to maintain a certain amount of residual income.
• Lender-specific debt-to-income requirements and credit score requirements.

USDA Loans

USDA loans are available for homebuyers in some rural and suburban areas. They are guaranteed by the USDA Rural Development Guaranteed Housing Loan Program, which is part of the U.S. Department of Agriculture. Most USDA loans come through partnering lenders, but some come directly from the Department of Agriculture. 

Best National USDA Lender: Fairway Independent Mortgage Corp.

The Fairway Independent Mortgage Corporation is a lender that provides several types of mortgage loan products. In addition to USDA loans, the company provides conventional mortgages, refinancing products, renovation loans and more. The lender has a team on staff to help borrowers navigate the homebuying process and find the right mortgage product for their situation. 

Minimum credit score: 620

Requirements: 

• Borrowers must be U.S. citizens or permanent residents.
• Borrowers must have a household income that does not exceed 115% of the median income in the county where the property is located. 
• The property must be the borrower’s primary residence.
• The property must be in an eligible rural area as defined by USDA.

How to Choose the Right Idaho Homebuyer Program

With so many programs out there, how do you choose? You can take several steps to narrow down your options and find the right homebuyer program for you.

Research and Compare Interest Rates and Eligibility Requirements

The first step is to look at the eligibility requirements of each homebuyer program. See which ones you may qualify for and eliminate the rest. Once you know which programs you may qualify for, you can start to look at the interest rates of each loan type and program.

Check Additional Perks

In addition to the interest rate, you’ll want to look for other perks and cost considerations. For example, you might qualify for some programs that offer a forgivable loan or with no down payment requirements. These might move higher up on your list of programs to consider. 

Consult With a Lender or Housing Counselor for Personalized Advice

It’s always a good idea to connect with a housing counselor or a lender for further assistance. These professionals can help you better understand eligibility requirements as well as fees and other factors that you’ll need to take into consideration.

Which Home Buyer Program Is Right For Me?

There are both state-specific and nationwide first-time home buyer programs for you to consider as an Idaho resident. It’s crucial to consider all of your options to determine which program is right for you. Look for the program that will help you purchase a home in your desired location and will fit the needs of your family. You should also consider the upfront costs in addition to the long-term costs of each program to find the one that fits your family’s budget the best. 

Frequently Asked Questions