Single Mom Home Loans NC

Single moms in North Carolina have access to a wide range of financial programs and affordable loan options that can enable them to afford a house and pay substantial money upfront. Purchasing a home is one of the biggest financial challenges you can make, which is why it is essential to know the best deal and all the options that are available at your disposal.

What Are The Different Loan Programs For Single Moms In North Carolina?

The North Carolina Housing Finance Agency, or NCHFA, operates many first-time home buyers’ loan programs, such as NC First Home Advantage Down Payment, NC Home Advantage Mortgage, and NC Home Advantage Tax Credit Programs for single moms and low-income home buyers. If you’re not able to find an affordable home buyer loan through NCHFA, then there are many other mortgage lenders throughout North Carolina that provide low or no-down-payment mortgages, including USDA, FHA, and VA loans that will enable you to become a homeowner soon.

Zero Down Payment Loan Programs

While purchasing a home in North Carolina, single mothers must make a down payment of around 20% of the actual purchase price. Low-income single mothers and home buyers struggle to pay this enormous amount. For single mothers, North Carolina has designed many home buyer programs. The zero down payment loan programs include VA loans and USDA loans, which do not require any down payment criteria as long as you can meet the eligibility criteria.

1. USDA Loans

Low-income families can apply for USDA loans if they purchase a property in designated rural areas. Eligible single moms and home buyers can buy a home through a loan guarantee program that does not require a down payment. In other words, single moms can secure a home loan with 100% financing. The United States Department of Agriculture wants to encourage rural development. It provides loan programs with reduced mortgage insurance prices, low origination fees, and low fixed-rate interest to single moms and other low-income home buyers to make loan payments more flexible and manageable. The loan offerings of USDA include the Section 504 Home Repair Program, Section 502 Guaranteed Rural Housing Loan, and Single Family Housing Direct Home Loans.

2. VA Loans

Private lenders like mortgage companies and banks provide VA loans which the United States Department of Veterans Affairs supports. These loans are provided to veterans and active duty service members along with their eligible spouses. There is a wide range of VA home loans that single moms in North Carolina can choose from, such as Native American Direct Loans, Home Purchase Loans, Interest rate reduction Refinance Loans, and Cash-Out Refinance Loans. Eligible single moms can reap lifetime benefits and use them multiple times. They do require one-time funding. However, they come with less stringent criteria. Unlike standard mortgages, there is no maximum credit score, debt ratio, or loan amount requirement in VA loans.

Low Down Payment Single Mom Home Loans In NC

FHA loans and conventional home loans are famous examples of low-down-payment loan programs in North Carolina that are available to single moms and other first-time home buyers.

1. Fannie And Freddie Loans

Fannie and Freddie are two conventional loans obtained through banks, private insurance lenders, private lending companies, and credit unions. The government does not insure these loans, and they come with stricter requirements and higher interest rates. Eligible home buyers and single moms can choose between conforming and non-conforming loans. Conventional loans having a 3% down payment will require private mortgage insurance to protect the interests of lenders if buyers default on their loans. Both conforming and nonconforming loans have a debt-to-income ratio of 45% or even lower.

2. FHA Loans

This is a low down payment loan option for borrowers who are finding it challenging to meet the requirements stated by conventional loans. Approved private lenders issue FHA loans and are not underwritten directly by any government entity. To qualify for FHA loans, single moms need a minimum 580 credit score that enables them to put in a minimum 3.5% down payment. A low credit score of 500 to 579 will require a down payment of 10%. FHA provides guarantees on loans to reduce the risk of private lenders. This is why you may get approval on your loan application despite a low credit score and down payment.

North Carolina Home Buyer Loan Programs

Following are the home buyer programs designed exclusively for first-time home buyers in North Carolina.

1. North Carolina First Home Advantage Down Payment

Military veterans and first-time home buyers who qualify for North Carolina’s First Home Advantage Down Payment can borrow an amount of $8000 as down payment assistance. To be eligible for this program, single moms need to have a credit score of 640 or higher as well as be first-time home buyers, and meet additional qualifying requirements.

2. North Carolina Home Advantage Tax Credit

The North Carolina Home Advantage Tax credit allows first-time home buyers to save around $2000 on federal tax and get a mortgage credit certificate. Single moms and other eligible applicants can claim a federal tax credit of up to 30% of the interest on an existing home. The interest rates will be higher for newly built properties.

3. North Carolina Home Advantage Mortgage

The North Carolina Home Advantage Mortgage enables eligible candidates to get a down payment of 3% on the home purchase price and a stable fixed-rate mortgage. It would help you meet the eligibility criteria to qualify for this program. This program is available to both first-time buyers as well as repeat buyers. This program provides fixed-rate mortgages on FHA, USDA, VA, and Conventional loans. To apply for this program, you must have an annual income of less than $126000, a credit score 640, and a debt-to-income ratio of 43%.

Conclusion

Single moms whose income is below a certain level can apply for government-backed loans like VA or USDA, which require no down payment. There are also conventional loans that require little down payment in North Carolina. Besides these, there are also statewide loan programs that enable single moms to make purchasing a property more realistic.