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The Essential Guide for First Time Home Buyers in FL

Top 14 First Time Home Buyer Programs in Florida (2024 Edition)

Whether you’re looking for a waterfront property in Key West, a chic condo in Miami or a home within one of Florida’s famous golf communities, you’re in luck. You can benefit from many first time home buyer financing programs. No matter how much money you have saved for your down payment, they are worth looking into because every dollar counts.

We know being a first time home buyer in Florida is exciting, but it can also be overwhelming. Get all the facts you need to know before starting your search.

House Hunting in Florida

As a first time home buyer in Florida, you’ll likely find the process simultaneously exhilarating and nerve-wracking. To reduce house hunting stress, here are a few things to consider prior to beginning your search:

  • What is your budget/how much home can you afford?
  • What is your credit score?
  • Would you prefer to live in the city, the suburbs or somewhere more rural?
  • What type of property are you looking for? (e.g. a single-family home, a duplex, condo, townhome, a co-op, etc.)
  • How many bedrooms and bathrooms do you need?
  • What are your must-have features in a home, and which features would simply be nice to have?
  • What is important to you? (e.g. a good school district, proximity to work, room to grow, etc.)

How to Prequalify for a Loan

Once you know which loan works best for you, it’s a smart move to get prequalified for a mortgage. Although you can forgo this step, doing so puts you at a disadvantage since a pre-qualified buyer who wants the same home as you will be able to bid on it first.

In addition, the process of getting prequalified for a mortgage gives you the opportunity to discuss loan options and budgeting with your mortgage broker. You’ll also learn what the maximum amount you can borrow is, which will help you determine your home purchase price range.

To get prequalified for a loan as a first time home buyer in Florida, you’ll need to provide the following to your mortgage broker:

  • Proof of income
    • Employee verification letter
    • Pay stubs from the past two months
    • IRS W-2 forms and tax returns from the past two years
  • Proof of assets
    • Savings account
    • 401(k)
    • Stock dividends
    • Investment account statements
  • Your tri-merge credit report
  • Your debt-to-income (DTI) ratio

First Time Home Buyer Programs in Florida

There are many Florida-specific and national loan options to help you buy your first home. Although your mortgage broker can help you navigate them, it’s a good idea to educate yourself about all the different loans that are available to first time home buyers in Florida.FAQ's ebook CTA

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6 Florida-Specific Programs

First time home buyers in Florida can benefit from the following Florida-specific loan options:

Loan Type Description Benefits
Florida Assist Loan Program Makes it easier for home buyers in Florida to make their down payments
  • Borrow up to $7,500 for their down payment
  • 0% interest
  • Deferred payments — doesn’t have to be repaid until you move out, sell the house, refinance or pay off the original mortgage
  • Must have an initial mortgage to apply the loan to
Homeownership Assistance for Moderate Income Loan (HAMI) Assists with down payments and closing costs
  • Offers borrowers up to $5,000 to assist with down payment and closing costs
  • Low fixed-rate second mortgage
  • Must be repaid over 10 years
Florida First Provides qualified buyers with a low fixed-rate mortgage
  • A low 30-year fixed-rate first mortgage
  • Borrowers who qualify for this first mortgage product automatically qualify for one of Florida Housing’s down payment assistance programs.
Florida Advantage For individuals who are purchasing homes in special geographic areas or have at least one disabled household member
  • Buyers must be at or below 80% of Area Median Income (AMI) adjusted for household size.
  • Buyers using this product qualify for Florida Assist.
Hometown Heroes For veterans and active duty military personnel, as well as certain healthcare workers and full-time employees of the school system, police departments and fire departments
  • 30-year first mortgage loan program
  • Florida Housing may offer a pool for these loans at a lower interest rate for the purpose of assisting this special target group.
3%, 4% and 5% HFA Preferred and HFA Advantage PLUS Second Mortgage Borrowers can take advantage of low down payment and closing costs for a forgivable second mortgage. This second mortgage is forgiven at 20% a year over its 5-year term.
  • 0% Interest Rate
  • No payments required

5 Federal First Time Home Buyer Programs

There are several national loan options — FHA, USDA, VA, Conventional, Jumbo — available to first time home buyers in Florida.

Loan Type Description Benefits
FHA A type of low down payment government loan insured by the Federal Housing Administration (FHA), a program office of the U.S. Department of Housing and Urban Development (HUD)
  • Low down payment
  • Flexible credit review
  • Fixed or adjustable-rate
  • Limited closing costs; seller can help pay closing costs
  • No prepayment penalty
  • Available to individuals with low credit scores or no credit history
  • Special 203(k) program for home repairs
USDA A type of government loan insured by the U.S. Department of Agriculture’s (USDA) Rural Housing Program that enables low- and moderate-income households to purchase property in eligible rural areas
  • No down payment required
  • Low mortgage rates
  • 100% financing
  • Reduced monthly mortgage insurance
  • Closing costs can come from a gift
  • Easy to qualify for
VA A loan provided by a private lender and guaranteed by the U.S. Department of Veterans Affairs (VA) in order to make homeownership more affordable for veterans
  • No down payment
  • No cash reserves
  • No application fees
  • No monthly mortgage insurance premiums
  • Funding fee may be financed
  • Seller can help pay closing costs
  • Low interest rates
Conventional The most common type of loan, conventional mortgages are private-sector loans that follow the guidelines set by Fannie Mae and Freddie Mac. Borrowers can choose between 15-year, 20-year and 30-year mortgages.
  • Low down payment
  • No upfront mortgage insurance
  • Potential for lower mortgage insurance rates or no mortgage insurance at all
  • Stable interest rates
  • More appealing to sellers
  • Shorter underwriter approval process
Jumbo (Non-Conforming) Any mortgage that exceeds the conforming lending limit of Fannie Mae or Freddie Mac.
  • Borrow more than a conventional or government-backed loan
  • Potential for lower mortgage insurance rates or no mortgage insurance at all

3 Grants for First Time Home Buyers in Florida

As a result of applying for and receiving real estate grant funds, you could obtain thousands of dollars in free grant money that you may never have to pay back. These funds would help you make your down payment or supplement your mortgage.

Grant Type Description Benefits
USDA Good Neighbor Next Door Program The  Good Neighbor Next Door program provides qualified first time home buyers who are law enforcement officers, firefighters, emergency medical technicians or teachers with discounted homes.
  • 50% discount off the list price of homes available in HUD’s inventory
  • Encourages renewal of revitalized areas
HUD Dollar Homes Low-to-moderate income families may be able to purchase a vacant home that was foreclosed on for just $1.00 via the HUD Dollar Homes program.
  • Homeowners can serve as a catalyst for neighborhood revitalization.
National Homebuyers Fund, Inc. Down Payment Assistance (DPA) programs are intended for home buyers who can afford monthly payments, but don’t have the funds needed to meet the Federal Housing Administration’s (FHA) 3.5 percent down payment requirement.
  • Helps home buyers with loans or grants to reduce down payment amount needed

Applying For a Mortgage in Florida

If you aren’t prequalified for a mortgage, you have 90 days to apply after submitting your final offer.

The process of applying for a mortgage is not nearly as daunting as it used to be thanks to the mortgage industry becoming increasingly automated. For most people, getting approved is the most challenging aspect. To facilitate the process, you’ll want to connect with a highly regarded mortgage broker. They will expertly guide you through the mortgage application process and act as an official liaison between you and lenders. Although it’s possible to work directly with your bank to apply for a home loan, a mortgage broker will have access to a large network of lenders, which enables them to identify favorable mortgage terms for you.

The underwriter approval process is similar to the mortgage prequalification process. An underwriter will review your application to determine your ability to repay your debt based on factors such as credit score, credit history, employment history, income stability, debt-to-income ratio and assets.

Based on their findings, the underwriter will either approve, deny or suspend your application. If approved, your next step would be to get a home appraisal. If suspended, the underwriter likely needs more information before they can proceed. If denied, don’t fret — the underwriter will clearly explain why your application was rejected, so you can work with your mortgage broker to resolve any issues and apply again.BWM_getting-ready-to-buy-a-home-cta

Making An Offer on A House in Florida

Once you’ve found your perfect home and are ready to make an offer, you should negotiate on the price. Don’t hesitate to walk away if a deal can’t be reached. Factors that will influence your offer include how long the house has been on the market and whether it requires any obvious repairs or upgrades. Once you have a signed offer, your lending institution will schedule an official home inspection. The home inspector’s report will reveal any unseen issues that may lead you to withdraw your offer or renegotiate.

 If you live in Florida and have any questions about buying your first home in the Sunshine State, contact one of our experienced mortgage brokers today. 

Closing on a Home in Florida

Your heart will likely be pounding in your chest from excitement as you’re about to take possession of your dream home. Only one step remains: closing on your new home with a title company.

During closing, your mortgage broker will work with you to review and sign all loan documentation, and you’ll be responsible for paying closing costs, which will likely include the following fees:

  • Appraisal
  • Origination
  • Legal
  • Title search
  • Insurance
  • Escrow

The total of your closing costs will depend on your mortgage option, loan amount, the type of property you purchase and its location. You may be able to offset them via various methods such as monetary gifts from family and friends depending on which loan type you chose.

If you have additional questions about becoming a first time home buyer in Florida, contact our friendly and knowledgeable team directly for more information.

Frequently Asked Questions

Q: Are there multiple loan options available to first time home buyers in Florida?

A: Yes. There are many Florida-specific and national loan options to help you buy your first home.

Q: Is being prequalified for a loan the same as being approved for a mortgage?

A: No. Don’t make the mistake of thinking that being prequalified for a mortgage means you’ve been approved for a mortgage. You’ll still have to secure funding by going through the standard loan application process. A mortgage broker can expedite the process by serving as a liaison between you and lenders.

Q: How much money do I need to put down on a house in Florida?

A: If you qualify for a VA or USDA loan, you’re eligible to put no money down; if you qualify for a conventional loan, you can put as little as 3% down.

Q: How much is the average PMI for Florida?

A: Private Mortgage Insurance (PMI) will fluctuate based on your credit score and down payment; use 0.7% for a good ballpark. For example, on a $100,000 loan, multiply $100,000 by 0.7% for a $700 annual cost, or $58.33 a month.

Q: Do I need to get a home appraisal in Florida?

A: Yes. Even if you’re completely in love with the home you’ve found, it may have hidden flaws or be overpriced. This is why underwriters require a home appraisal from a lender-approved appraiser before they’ll provide final mortgage application approval. The home appraisal provides them with an objective idea of the home’s value and ensures you aren’t over-extending yourself financially.

Q: What do home appraisers do?

A: Home appraisers review:

  • Current market trends
  • The general condition of the home
  • Square footage
  • The number of bedrooms and bathrooms
  • Additional space (e.g. basement, attic, crawl space)
  • Building materials
  • Foundation type
  • Home improvements, upgrades and added amenities
  • Neighborhood characteristics
  • Lot size
  • Recent sales of similar properties

Once the appraisal is complete, the appraiser will submit their findings to the underwriter for final review and approval. If approved, your mortgage broker will work with the lender to lock in the most beneficial interest rate prior to closing.

Roger Odoardi

Roger is an owner and licensed Loan Officer at Blue Water Mortgage. He graduated from the University of New Hampshire’s Whittemore School of Business and has been a leader in the mortgage industry for over 20 years. Roger has personally originated over 2500 residential loans and is considered to be in the top 1% of NH Loan Officers by leading national lender United Wholesale Mortgage.

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