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HomeBank LoanMissouri First-Time Homebuyer Packages | The Lenders Community

Missouri First-Time Homebuyer Packages | The Lenders Community


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First Place Loan Program

First Place Loan program is a homebuyer program that provides a pool of money at below-market interest rates that lenders can access to provide loans to first-time homebuyers and qualified veterans in the state of Missouri. One part of the program also provides down-payment and closing cost assistance. More info

First Place Loans are available for those who:

  • Have not owned or had principal interest in a home in the past three years OR are a qualifying veteran
  • Have qualifying credit (minimum credit score required).
  • Meet income and purchase price limits.
  • Household income limits are based on the total gross annual household income
  • Purchase price limits are the same throughout the state.
  • Must be a single‐family home, one‐half duplex, semi‐detached home, condominium, townhome, or manufactured home on a permanent foundation.
  • Loans made in the program may be subject to recapture tax provisions under federal law.
  • The homebuyer must occupy the home within 60 days of loan closing.

Program Benefits

  • The cash assistance loan for the down payment and closing costs will be 4% of the first mortgage amount.
  • Cash assistance will be in the form of a second mortgage. Second mortgage forgiven if borrower stays in the home for ten years.
  • Thirty (30) year fixed rate mortgage (FHA, VA, USDA Rural Development, Freddie Mac qualified).

Mortgage Credit Certificate (MCC)

A certificate provided by the Missouri Housing Development Commission (MHDC) to the borrower that directly converts a portion of the mortgage interest paid by the borrower into a non-refundable federal tax credit. More info

  • A certificate provided by the Missouri Housing Development Commission (MHDC) to the borrower that directly converts a portion of the mortgage interest paid by the borrower into a non-refundable federal tax credit
  • The MCC can only be issued by MHDC through a MHDC Certified Lender, and are typically available only to low– or moderate-income homebuyers
  • It is designed to help first-time homebuyers qualify for a home loan by reducing the borrower’s tax liabilities below what they would otherwise have to pay
  • The MCC is good for the “Life of the Loan.” The credit is worth
  • 25% MCC Stand Alone
  • 35% if used with the Next Step CAL Program
  • 45% if used with the Next Step NON-CAL Program
  • The maximum allowable credit in a year is $2,000
  • The homebuyer can carry forward the unused portion of the credit for up to three years or until used, whichever comes first.

Program Eligibility

  • First-time Homebuyers must not have owned or had principal interest in their primary residence in the past three years
  • Homebuyers must apply with a certified lender
  • Homebuyers must have qualifying credit (minimum credit score required)
  • Homebuyers must meet income and purchase price limits (see charts on the right)
  • The property can be a single-family detached home, one-half duplex, semidetached homes, condominiums, townhomes, or manufactured homes on a permanent foundation.

Next Step Program

The Next Step Program enables non-first-time homebuyers who lack sufficient equity or funds for downpayment to purchase their new home. First-time homebuyers may also use the Next Step Program in conjunction with the Mortgage Credit Certificate Program. More info

The Next Step Program is available for those who

  • Have qualifying credit (minimum credit score required)
  • Meet income and purchase price limits
  • Household income limits are based on the total gross annual household income
  • Purchase price limits are the same throughout the state.
  • Must be a single‐family home, one‐half duplex, semi‐detached home, condominium, townhome, or manufactured home on a permanent foundation.
  • The homebuyer must occupy the home within 60 days of loan closing, and continue to be occupied as long as the loan exists
  • Borrowers should contact one of our certified lenders throughout the state. A list of them can be found at: www.mhdc.com
  • First-time homebuyers may combine this program with our MCC program. Those borrowers must meet all the requirements for the MCC program.

Program Benefits

  • 4% cash assistance loan for the down payment and closing costs
  • Cash assistance will be in the form of a second mortgage. Second mortgage forgiven if borrower stays in the home for ten years.
  • Thirty (30) year fixed rate mortgage (FHA, VA, USDA Rural Development, Freddie Mac qualified)

HeRO Program

The Home Repair Opportunity (HeRO) Program provides funding to meet the need for home repair, modification, and maintenance for low- and moderate-income homeowners in the non-metropolitan areas of Missouri. MHDC provides the funds to selected eligible Sub-Grantees (community action agencies) from its annual HOME allocation using a competitive application process that begins with the issuance of a Notice of Funding Availability.

Eligible homeowners may receive cash assistance up to $22,500 for necessary repairs, modifications, and maintenance on eligible properties. Contact the Sub-Grantee servicing the county in which the home is located to make an application. More info

Who is eligible

  • Owner-occupied homes with ownership in fee simple title, ownership via inheritance, life estate, or living trust beneficiary
  • Lived in the home for at least three years
  • Meet specific income guidelines for a low- or moderate-income qualifying homeowner defined as a household earning an annual income of 80 percent or less of the Area Median

National First-Time Homebuyer Loans

  • FHA LoansFHA home loans are very popular with first-time homebuyers cause they require a 580 credit score with just a 3.5% down payment. Debt-to-income ratios up to 50% are allowed making them perfect for low-income borrowers.
  • Conventional LoansConventional loans require a 620 credit score and a 5% to 20% down payment. If you put 20% or more down, mortgage insurance will not be required.
  • USDA LoansUSDA mortgage loans are for low-to-median income borrowers buying a home located in a USDA-eligible rural area. They provide 100% financing with a 620 or higher credit score. Mortgage insurance is required but the rate is the lowest of any type of mortgage program available.
  • VA Loans – Veterans of the U.S. military may be eligible for a VA home loan. No down payment or mortgage insurance is required and veterans with a 580 to 620 credit score are eligible.
  • HomeReady and Home Possible Loans – Freddie Mac and Fannie Mae created the HomeReady and Home Possible loan programs for low-income first-time homebuyers whose income does not exceed 100% of the area median income requiring just a 3% down payment and a 620 credit score.

 

Helpful Resources

Statewide and Regional Programs

Programs by City/Town

Getting Started

Buying a Home

Owning and Maintaining Your Home

Other Missouri Resources

RELATED ARTICLES

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