First Time Home Buyer New Orleans

First-Time Home Buyer New Orleans: Programs and Grants

Are you a first-time home buyer looking to purchase your first home in New Orleans or the Surrounding Areas.  There are many different loan programs available to you in order to purchase your first house.

Many of these programs will allow you to put little or no money down and offer some type of home buying assistance. 

First-Time Home Buyer Programs in New Orleans

A first-time home buyer is anyone who hasn’t yet owned a home. New Orleans first-time home buyers have access to a few different types of loan programs. The first type of program you’ll have access to is your traditional mortgage loans. 

FHA Loans

FHA loans are a great program for first-time home buyers. FHA allows you to put a small percentage down and has very flexible credit requirements. 

FHA Requirements for New Orleans: 

  • 580 Credit Score 
  • 3.5% Down Payment 
  • Have Documented Income 
  • Purchase a primary residence 
  • Meet FHA loan limits 

FHA also has a program that will allow you to purchase a home if you find your credit score lower than 580 but you’ll need 10% down. 

USDA Rural Development Loans

RD Loans are another great loan program for those who don’t mind living outside of the city.  As long as you plan to live outside of New Orleans, Metairie or Kenner you could use the USDA Loan.

The best part about RD loans is that they are a $0 down payment program. 

USDA Loan Requirments in New Orleans: 

  • Minimum Credit Score of 580 (640 for automated approval) 
  • Purchase a primary residence 
  • Buy in an eligible area 
  • Make less than 115% of the Area Median Income 

First-Time Home Buyer Grants in New Orleans

Grant programs are another great way to get help when purchasing a house. Grant programs will offer you assistance with your down payment and closing costs.  When using a home buyer assistance program, you may have to meet additional requirements. 

New Orleans has three very popular home buyer assistance programs: 

Direct Homebuyer Assistance- City of New Orleans 

This homebuyer assistance program provides down payment and closing costs assistance to eligible first-time home buyers.  The program does have limited funds each year so when your purchase a home could affect if you can use this program. 

The Direct Homebuyer Soft Second Mortgage Assistance Program helps homebuyers with up to $55,000 in soft second funds and up to $5000 in closing costs assistance!  The guidelines only allow them to cover 50% of the closing costs for your future purchase. 

How to Qualify for New Orleans Home Buyer Assistance: 

  • Complete a homeownership training course 
  • Qualify for a Mortgage with an Approved Lender 
  • Make 80% or Less of the Area Median Income

While the list of lenders who can offer this program is pretty small, if you can meet those lenders’ requirements this program could go a long way in helping New Orleans’s First-Time Homebuyers. 

Resilience Soft Second- LHC 

Another popular program for residents of New Orleans is the Louisiana Housing Corporation Resilience Soft Second. 

The LHC Soft Second Program is very similar to the one offered by the City of New Orleans. 

  • The Soft Second is 20% of the purchase price up to $55,000
  • Up to $5000 for Closing Costs

LHC also offers numerous other homebuyers grants and programs:

  • Mortgage Revenue Bond Home
  • Mortgage Revenue Bond Assisted 
  • Mortgage Credit Certificate

Just like the other programs you’ll need to purchase a house using one of their approved lenders. 

CAFA Grant

The Capital Area Finance Authority also offers a home buyer assistance program called CAFA Gold.  this program provides homebuyer assistance for qualified homebuyers to purchase a house. The program comes in the form of a forgivable second lien on your house and can provide up to 7% in down payment and closing costs assistance. 

CAFA GOLD Requirements: 

  • Minimum Credit Score of 620 
  • Debt-to Income Ratio of 55% or less 
  • Maximum Sales Price of $356,362 for FHA and $548,250 for Conventional 
  • Meet Program Income Limits 

The CAFA program is extremely popular across Louisiana and is a go-to down payment assistance program for most lenders.  We offer this program for our clients here at Bayou Mortgage. 

How to Become a First-Time Homebuyer in New Orleans

If you want to get the process started to buy your first home you need to speak with an expert. While many first-time home buyers start by shopping for homes, it’s a bit backward. 

Check out our Louisiana First-Time Home Buyer Guide

By speaking with a lender you will know what your options are and what to expect. A loan officer will tell you: 

  • Interest rate and payment 
  • Down payment and closing costs 
  • Home price range 
  • What document’s you’ll need 
  • Potential pitfalls and issues 

This should be the first step you take when deciding to get started with the home buying process. We’d love to help your get started. If you’d like our help just click the see what you qualify for button below. 

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