First Time Home Buyer In Virginia? Is a VHDA Loan Right For You?

Shopping for your first home is a complicated process. If not, then you are probably not being exposed to all the options that are out there for you as a first time home buyer. For instance, here are a few “did you know’s”:

  1. With an FHA 203k loan you can receive up to $35,000 to put toward renovation costs?
  2. Arlington, Alexandria, and other locals offer incentives for green building.
  3. Many builders today are offering substantial closing cost assistance, as well as thousands of dollars in upgrades.

These are just a few, but there is one more “did you know” specifically for first time home buyers in Virginia. An non-profit entity in Virginia called the Virginia Housing Development Authority, or the VHDA for short.

If as a first time home buyer (or someone whoVHDA Loan Program has not owned a home in the last 3 years) you are willing to jump through a couple of hoops, you can qualify for a VHDA home loan, which could save you precious points on your interest rate. Buyers have to apply with the VHDA, and must go through their home buyer/owner course to obtain a certificate. Once you have your certificate you can then approach any VHDA qualified lender to begin shopping for the right loan for you, and likely at lower rates than your fellow home buyers.

VHDA applies to a number of loan types including Conventional and FHA. There is a maximum loan limit of $450,000, so if you were putting 20% down that would allow you to purchase a home up to $562,500 (I am not a lender, or a mathematician, but if this is wrong it is at least in the ball park).

As an example of what VHDA can save you; at the time this post was created the general going interest rate for a 30yr fixed mortgage is 4.625% ($2,313.63 per month on a $450,000 loan over 30 years). If you were to buy that same loan under the VHDA program today’s VHDA rate would be 4.25% (2,213.73 /mo on a $450,000 loan over 30 years). So, using today’s rate comparison on a $450,000 30/yr fixed rate loan you would save roughly $1,200 a year.

VHDA does offer Homeownership Courses throughout the state during the year, including one this coming Saturday the 30th of July from 9am to 3pm in Arlington as well as Alexandria.


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