Pennsylvania’s First-Time Homebuyer Program

Buying your first home is an exciting time. However, it can also be a time of uncertainty and confusion as you try to navigate the buying process. This can be especially true for first-time buyers who aren’t sure what to expect as the process unfolds.

If you are a qualified borrower planning to purchase a home in Pennsylvania, there are a number of resources available that can help make the home-buying process a little easier.

The Pennsylvania Housing Finance Agency (PHFA) offers several loan programs designed to help first-time homebuyers and other qualified borrowers purchase a home. These programs include:

• Keystone Home Loan: This loan program has the fewest eligibility requirements and the highest income and purchase price limits.
• Keystone Home Loan PLUS: These loans offer the lowest interest rates available, but with the most stringent eligibility requirements.
• Keystone Assistance Loan Program: This program offers zero-interest second loans designed to cover the costs associated with buying a home.

Maximum assistance amounts are $1,500 for those who qualify for the Keystone Home Loan and $3,000 for the Keystone Home Loan PLUS program. These loans do not require any monthly payments and are repayable only when the home is sold or transferred.

Pennsylvania’s first-time homebuyer programs include both conventional and government-insured loans, such as those offered by the Fair Housing Administration (FHA), the Veterans Administration (VA) or Rural Housing Services (RHS).

Exact qualification requirements vary between the different first-time homebuyer programs and the specific type of loans available within them. To find the best solution for your situation, call an experienced PHFA-approved loan professional for a no-obligation consultation.

Eligibility Requirements for PHFA’s Keystone Home Loan Program

The Keystone Home Loan is available to qualified first-time homebuyers in Pennsylvania. To qualify, all adults who plan to live in the residence during the first 12 months must not have owned their principle residence during the last three years. In addition to qualified first-time homebuyers, these loan programs are also available to discharged military veterans and to those who purchase homes in recognized target areas.

In addition, this program also includes gross annual income limits for all adults who plan to occupy the home in the first year, along with purchase price limits for the property.

Homebuyers must also be creditworthy and able to make the monthly mortgage payments. They must also be able to supply the funds for standard mortgage applications fees and closing costs.

Finally, borrowers are required to fund the down payment, which varies from 5% for conventional loans with credit scores below 660 down to no-money-down options for Veterans Administration (VA) and Rural Housing Services (RHS) loans.

Additional Eligibility Requirements for the Keystone Home Loan PLUS Program

The Keystone Home Loan PLUS program offers lower interest rates than the standard Keystone Home Loan program. All of the above-noted eligibility requirements must be met, along with a number of stricter qualifications, including:

All adults who plan to reside in the home for the first 12 months must be first-time homebuyers who have not owned their own home or any other real estate outside of business property in the last 3 years. This requirement applies regardless of whether or not the home is located within a recognized target area.

The PLUS loan program also has lower income and purchase price limits and stipulates that total combined household liquid assets cannot exceed $5,000 after the funds needed to close on the property are deducted.

Getting Started

The above requirements provide a general overview of what is required to participate in Pennsylvania’s first-time homebuyer programs. However, no single program or loan product is right for every individual. Therefore, we recommend talking to an experienced PHFA-approved loan professional to find out which of these programs is right for you.

Have Questions? Call today for a no-cost, no-obligation consultation with one of our experienced PHFA-approved mortgage consultants.