Purchasing a home is a significant investment, and many home buyers in South Carolina may find it challenging to come up with the funds needed to make a down payment and cover closing costs. Fortunately, there are several types of financial assistance available to help make the home buying process more accessible and affordable. In this article, we will explore some of the financial assistance options available to home buyers in South Carolina.
Down Payment Assistance Programs
One of the most significant hurdles for many home buyers is coming up with a down payment. In South Carolina, there are several down payment assistance programs available to help eligible home buyers. These programs offer financial assistance in the form of grants, loans, or forgivable loans that can be used towards the down payment or closing costs of a home purchase.
The South Carolina State Housing Finance and Development Authority (SC Housing) offers several down payment assistance programs, including the Palmetto Home Advantage Program, which provides up to $6,000 in forgivable down payment assistance for first-time home buyers or military veterans. Other down payment assistance programs available in South Carolina include the HOME Down Payment Assistance Program and the SC Mortgage Tax Credit Program.
Mortgage Credit Certificates
A Mortgage Credit Certificate (MCC) is a program that provides eligible home buyers with a federal tax credit equal to a percentage of their mortgage interest. The MCC can help reduce the amount of federal income tax a homeowner owes each year, which can result in significant savings over the life of the loan.
The MCC program is available to first-time home buyers, veterans, and those who haven’t owned a home in the last three years. The credit amount is determined by the mortgage interest rate and the amount of the mortgage loan.
Federal Housing Administration (FHA) Loans
The Federal Housing Administration (FHA) offers loans that are designed to help first-time home buyers and those with low to moderate incomes. FHA loans require a lower down payment than conventional loans and have more flexible credit requirements.
FHA loans are available for a variety of property types, including single-family homes, condominiums, and multi-unit properties. The maximum loan amount varies by county in South Carolina.
USDA Loans
The United States Department of Agriculture (USDA) offers loans to eligible home buyers in rural areas. USDA loans offer several benefits, including 100% financing, no down payment requirements, and lower mortgage insurance premiums.
To be eligible for a USDA loan, the home must be located in a designated rural area, and the borrower must meet certain income requirements. USDA loans are available for single-family homes, condos, and manufactured homes.
There are many types of financial assistance available to home buyers in South Carolina. These programs can help make the home buying process more accessible and affordable for those who may be struggling to come up with the funds needed to purchase a home. Home buyers are encouraged to research the various programs available to determine which ones they may be eligible for and which ones best fit their financial situation. Speaking with a local lender can lead you to additional programs that aren’t included in this list. Often times, private lenders will have their own programs available to buyers.