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Washington State First Time Home Buyer Guide 💸 | 13 WA First Time Home Buyer Programs

Last Updated on: 1st June 2023, 04:48 am

If you are thinking about buying a house in Washington State, then you may be wondering how you can make the process more affordable. If you haven’t purchased a house in the past three years, then you are considered to be a first time home buyer. As a first time home buyer in Washington, there are many programs and grants you can utilize to purchase your house at a fair cost.

There are many different types of first time buyer assistance options in Washington, such as primary mortgages, closing cost grants, and down payment loans. No matter what your needs are, there is something for you! This is everything you need to know about first time home buyer programs in Washington.

First Time Home Buyer Tax Credits & Down Payment Assistance in Washington

There is not currently a Washington first time home buyer tax credit, but you may want to keep an eye on the proposed First-Time Homebuyer Act. This is a bill that has been proposed by President Joe Biden, and it would reduce tax bills by $15,000 for singles and $7,500 for married individuals who file separately. This bill has not yet been approved.

Home Advantage DPA

Every Washington first time home buyer should know about the Home Advantage Downpayment Assistance Program. This down payment loan offers a 0% interest rate and payment deferred for 30 years. This second mortgage loan program combines with the Home Advantage first mortgage loan program, so borrowers must meet the income limits for this program first. To qualify for this loan, you cannot have an income of more than $180,000.

Home Advantage DPA Needs Based Program

The Home Advantage DPA Needs Based Program is one of the most popular down payment assistance programs in Washington. This program, which is also paired with the Home Advantage first mortgage program, is available for buyers who earn less than the average income limit. If your income is less than $146,500 in King and Snohomish counties and less than $114,600 in all other counties, then you can qualify for a loan of up to $10,000. This loan carries a 1% interest rate and has a 30 year payment deferral period.

Opportunity DPA

If you are searching for down payment assistance in Washington, then you need to check out the Opportunity DPA. This down payment assistance program is paired with the House Key Opportunity Program. The Opportunity DPA creates a second mortgage of up to $15,000 and carries a 1% interest rate and a 30 year payment deferral period. The maximum income limit for this program is as follows:

Veterans Downpayment Assistance Loan Program

If you are a resident of Washington state and have served the country, you may be eligible for up to $10,000 in down payment assistance. This second mortgage has a 3% interest rate and can be deferred for 30 years. To become eligible for the veteran’s program, your income must not exceed $145,500 in King and Snohomish counties and $114,600 in all other counties. You can pair the veteran program with the Home Advantage or House Key Opportunity first mortgage options.

HomeChoice Downpayment Assistance Loan Program

If you are searching for down payment assistance in Washington and have a disability, then you should check out the HomeChoice Downpayment Assistance Loan Program. This is a second mortgage loan program for borrowers who have a disability or a family member with a disability living with them. With this loan program, you can receive up to $15,000 at a 1% interest rate and a 30 year deferral period. The maximum income for this loan is $146,500 for King and Snohomish counties and $114,600 for all other counties. In order to receive this loan, you must attend one-on-one counseling.

First Time Home Buyer Loans in Washington

If you are interested in getting a home loan in Washington, then you may want to attempt to get pre-approved by a bank. This is typically the fastest way to acquire a loan. When you get pre-approved, you let the seller know that you are serious about purchasing a home. Getting pre-approved for a loan depends on many different factors, such as your credit score, estimated down payment, and mortgage payment.

When getting pre-approved, it is recommended to follow the 28/36 rule. The 28/36 rule states that your total housing costs should not exceed 28% of your gross monthly income, and your total debt payments should not exceed 36%. Make sure you are planning ahead, as the best time to get pre-approved is at least one year before you decide to purchase.

Here are a few of the most popular first time home buyer programs in WA.

WSHFC House Key Opportunity

The House Key Opportunity is a first time home buyer loan in Washington that is offered by the Washington State Housing Financing Commission (WSHFC). This program uses proceeds of tax-exempt bonds, which provides buyers with a lower interest rate than many other loan options. In order to qualify for this loan, you must not exceed the following annual household income limits:

The home you are planning to purchase must also not exceed a certain amount. This amount ranges from $345,000 to $750,000 based on the area where the home is located.

WSHFC Home Advantage

The WSHFC Home Advantage program is an easy-to-acquire first time home buyer loan in Washington. This program qualifies first time home buyers in Washington for a low interest rate. In order to qualify for this loan, you must have a minimum credit score of 620, a maximum 50 percent debt-to-income ratio, and an annual income under $180,000. The interest rates on this loan change daily, so it is important to check the website frequently.

WSHFC EnergySpark

If you purchase an energy-efficient home or make upgrades to an existing home at the time of purchase, you can use the WSHFC EnergySpark home loan to save .25% on your interest rate. The qualifications for this home loan are the same as the WSHFC Home Advantage loan. You must either purchase a qualifying new construction home or make improvements to an existing home that will improve the home’s energy efficiency by at least 10%.

Conventional Loans

Conventional loans, also known as Frannie Mae and Freddie Mac, are some of the most popular loan options for first time home buyers. If you are a first time home buyer in Washington with bad credit, then a conventional loan may not be your best option. You will need to have a minimum credit score of 620 to qualify for a conventional loan. When you acquire a conventional loan, you can borrow up to 97% of the loan, which means you only need to provide 3% for the down payment.

FHA Loan

When you get an FHA loan in Washington, you have the opportunity to pay as low as a 3.5% down payment. To qualify for an FHA loan in Washington, you have to be under the local FHA loan limits in your area. The maximum loan limit in Washington is $472,030 for a single-family home and $1,879,850 for a four-plex. The minimum loan limit is $5,000.

VA Loans

The VA helps servicemembers, veterans, and eligible surviving spouses to buy a home. VA home loans are backed by private lenders such as banks and mortgage companies. When you get a loan through the VA, you will enjoy benefits such as low interest rates, no down payment, limited closing costs, and no need for Private Mortgage Insurance. You are also able to use the VA home loan multiple times, as it is a lifetime benefit.

First Time Home Buyer Programs in Seattle/King County

Seattle is one of the most popular cities in Washington for first time home buyers. Here are a few first time home buyer programs to consider when buying a house in Seattle.

Office of Housing Program

The Office of Housing Program is a down payment assistance program in Seattle that can provide first time home owners with up to $55,000 toward their down payment. To qualify for this program, your household must earn less than 80% of area median income by household size and your home must be inside the city limits of Seattle.

Office of Housing Program, 700 5th Ave, Suite 5700, Seattle, WA, 98104, (206) 684-0721

Seattle Downpayment Assistance Loan Program

The Seattle Downpayment Assistance Loan Program is a second mortgage loan program that allows up to $55,000 in down payment assistance with payment deferred for 30 years at a 3% interest rate. To be eligible for this program, your household income must not exceed these limits:

Washington First Time Home Buyer FAQs

Are first time home buyer programs worth it?

First time home buyer programs are absolutely worth it. You can use the money that you save to spend on other necessities such as utilities, groceries, and transportation.

Who is considered a first time home buyer in Washington?

A first time home buyer is someone who has not owned or occupied a primary residence in the last three years.

Do you have to pay back down payment assistance in Washington?

If you receive a loan, you are required to pay it back. A grant, however, you do not have to repay.

Are you ready to become a first time homebuyer in Washington? All Ready Moving is here to make your move as easy and stress-free as possible. Feel free to contact us today at (360) 507-2447 to discuss your move and receive a free quote!

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