Maryland Mortgage Programs for first-time homebuyers can be used with conventional or government-backed home loans (FHA, VA, and USDA)
MMP 1st Time Advantage
Offers eligible first-time homebuyers the lowest 30-year fixed interest rate available from the program for a home loan. (Mortgage credit certificates may not be layered with 1st Time Advantage loans)
The 1st Time Advantage line includes:
- 1st Time Advantage Direct
No down payment assistance (DPA) is available but offers our most competitive interest rates.
- 1st Time Advantage 5000
$5,000 loan for the down payment and closing costs. This second lien has a zero percent interest rate, and no payments are due for the life of the first mortgage. As soon as the first mortgage ends (repayment, refinance, transfer, sale, etc.), the second lien is due and payable.
- 1st Time Advantage 3% Loan
Comes with a DPA loan equal to 3% of the first mortgage in a zero percent deferred second lien
This product is only available for first-time homebuyers, unless:
- The borrower is purchasing in a targeted area and sold their current home prior to closing on the new property; (for more information on targeted areas ); OR
- It’s been more than three years since the borrower has owned a principal residence; OR
- The borrower is an honorably discharged veteran who has not previously used the first-time homebuyer exemption.
MMP Flex Loans
30-year, fixed-rate home loan products accompanied by additional funds for the down payment and closing costs. The assistance is available in the form of no-interest, deferred loan, or an outright grant (which doesn’t get repaid).
- Flex Direct
No down payment assistance (DPA) is available but offers our most competitive interest rates available to repeat home buyers. External sources of DPA may be used.
- Flex 5000
$5,000 loan for the down payment and closing costs. This second lien has a zero percent interest rate, and no payments are due for the life of the first mortgage. As soon as the first mortgage ends (repayment, refinance, transfer, sale, etc.), the second lien is due and payable. The 5000 line is eligible for Partner Match funds, if applicable.
- Flex 3% Loan
DPA loan equal to 3% of the first mortgage in a zero percent deferred second lien.
- Flex 3% Grant
Grant equal to 3% of the first mortgage. Grant is not repaid.
- Flex 4% Grant
Grant equal to 4% of the first mortgage. Grant is not repaid.
These programs often include grants, loans, and other helpful assistance, and you should begin research early in the home buying process to discover which programs may be available to you.
If you’re using the 1st Time Advantage 5000 or the Flex 5000 loan products to purchase your home, any financial assistance you receive from one or more of these Partners is matched (up to $2,500) as additional down payment assistance. This additional funding is in the form of a no-interest, deferred loan from the state, payable when the first mortgage is fully paid off.
There is a wide range of organizations with programs to help homebuyers, including:
- Employers making an investment in the long-term sustainability of their workforce,
- Homebuilders and real estate developers who give financial and other incentives to encourage purchase of their properties,
- Community organizations that encourage homeownership as a way of building sustainable neighborhoods, and
- Local governments attracting new residents to their community.
Montgomery Homeownership Program VI
The Montgomery Homeownership Program VI, an initiative of the Maryland Mortgage Program in partnership with Montgomery County, gives eligible homebuyers purchasing in Montgomery County up to $25,000 in down payment assistance.
This financial incentive is provided by Montgomery County to help working families and first-time homebuyers achieve affordable homeownership in the County. Eligible homebuyers can take advantage of this assistance by purchasing their home through the Maryland Mortgage Program, which has helped thousands of families achieve homeownership and comes with the security that only the state’s flagship homeownership program can provide. Download the Fact Sheet
HomeAbility is a special product designed to assist Maryland homebuyers with disabilities to finance their home purchase. This is a Conventional Loan product and provides an 80% LTV first lien and up to 25% in a second lien to assist with down payment and closing costs. No mortgage insurance is required. The interest rate for the first lien is posted on the Interest Rates page; the second lien has a rate of 0% and payment is deferred for the life of the first lien, but becomes payable upon sale, refinance, or transfer of the home.
To be eligible for HomeAbility:
- One of the borrowers has disabilities OR one of the borrowers is a guardian for, resides with, and is the principal caregiver for an immediate family member who is disabled (regardless of age).
- Disability is documented by submitting:
- a CDA “Certificate of Disability” completed by a health, mental health, or disability professional; and/or
- proof of income from Social Security Administration (i.e. SSI or SSDI), VA, or former employer: the proof is a copy of the borrower’s disability policy, award letter, or benefits statement from the benefits payer (insurance company, employer, or other qualified disinterested party), per FNMA’s guidelines; or
- proof of application for disability benefits evaluation and a copy of the Social Security Administration office’s decision on the application.
- It is entirely CDA’s decision as to the sufficiency of the documentation.
- Borrower(s) individual income is less than or equal to the Area Media Income Limits shown below.
Maryland Smartbuy Program
Maryland SmartBuy 3.0 gives homebuyers an opportunity to purchase any home in Maryland that meets Maryland Mortgage Program guidelines while paying off student debt.
To qualify for the Maryland SmartBuy 3.0 program, homebuyers must have an existing student debt with a minimum balance of $1,000. Maryland SmartBuy 3.0 financing provides up to 15% of the home purchase price for the borrower to pay off their outstanding student debt with a maximum payoff amount of $30,000.
The full student debt for at least one of the borrowers must be paid off at the time of the home purchase, and homebuyers must meet all eligibility requirements for the Maryland Mortgage program. Program information
National First-Time Homebuyer Loans
- FHA Loans – FHA 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 Loans – Conventional 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 Loans – USDA 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.