This is a general introduction to finance help available to first time homebuyers according to the Florida Housing Finance Company. It should be used as a guideline to understanding programs available. Depending on which county you are seeking to live in, you are asked by Florida Housing to reach out to a locally approved lender for specific qualifications needed per county to be eligible.
Florida Housing’s First Time Homebuyer Mortgage Loan Programs offer homebuyers 30-year, fixed-rate first mortgage loans. These loans are available to borrowers seeking to purchase a primary residence in Florida. First time homebuyers are defined as those that have not owned a property in the past three years or who may have used the property in Florida as an investment property only. They are offered through participating lenders and institutions on both the state and local levels. Participants must meet program income limits, and purchase price limits. Also, the homebuyer must complete an education course that is typically about 6-8 hours long. Borrowers who are eligible can also participate in the Florida Assist program, which is a second mortgage loan program Florida Housing offers to assist with the down payment and closing costs. To participate in these programs, you do not have to necessarily be a first time homebuyer such as if you are a veteran or if you are looking to purchase a home in a Federally Designated Targeted area.
Florida Assist is the program that offers second mortgage loans to borrowers to help with closing costs and down payments. Each of the 5 counties we serve offers the Florida Assist package to qualified borrowers. They will give borrowers typically up to $7,500 by offering a 0% deferred second mortgage. I did see some counties that bumped up this amount to $10,000. Florida Assist doesn’t require a monthly payment, because repayment is deferred. However, it does become payable in FULL when you satisfy the first mortgage, refinance the property, or you do not reside on the property anymore, say you sale it, or even transfer it.
First Time Homebuyers Programs determine eligibility considering borrowers income, and by setting purchase price limits that differ between counties. Also, depending on which type of loan borrowers choose they generally must have a qualifying FICO score of 640 to 660, and qualify for a mortgage loan through one of the counties approved lenders.
To find approved lenders please visit Florida Housing’s homebuyer wizard and select which county you are thinking of buying a home in. It will populate a list of approved lenders towards the bottom of the screen.
Numerous incentives are offered for borrowers looking to purchase in a Federally designated target area. These are areas throughout the state that are targeted by Florida known as areas of economic opportunity. Their goal is to foster growth within these communities. Incentives include waiving the first time homebuyer requirement, and increasing the maximum allowable income and purchase price requirements.
First-time Homebuyer Mortgage Programs are available in each of the 5 counties we serve and have been listed and detailed below. This information is based on the Florida Housing finance website available below. We have included a breakdown per county of what can be expected when trying to qualify based on a family of two.
These tax free municipal bonds or loans are funded by mortgage revenue bonds, which offer the borrower a lower interest rate than privately issued loans. To “recapture” this benefit the state and counties offer, the recapture tax will be due the year you dispose of your home, or sale the home. The borrower will be always be subject to paying higher federal income taxes that year. However, Florida Housing has recently began to offer a benefit of reimbursing borrowers the full amount of any federal recapture tax that is owed and paid upon selling or disposing of the home. But, there are 3 instances a borrower will be subject to this recapture tax and not reimbursed.
1. You sell your home or dispose of it within the first 9 months of closing your mortgage loan.
2. In the year your sale your home your income has increased and exceeds the IRS established limits.
3. You have a “net” profit from the sale.
Listed below are the four typical mortgage loan programs offered according to the Florida Housing Finance Company.
First, is the Florida First mortgage loan program, it is a 30 year fixed rate mortgage loan program. It may be used along with the Florida Assist program. It is only available for FHA, VA, and USDFA-RD Government Loans. All borrowers who qualify for a Mortgage Revenue Bond qualify for this program.
Mortgage revenue bonds (MRB) are tax-free municipal bonds designed to help low-and middle-income first-time homebuyers by offering long-term mortgages at below-market interest rates. Florida and its’ local governments issue MRB’s to investors, who then use capital proceeds to invest in the state’s MRB home loan program.
Second, is the Florida Military Hero’s Mortgage Program. It is a 30 year fixed rate mortgage loan program offered to Veterans and active military personnel with below market interest rates. This programs purpose is to help active and retired military personnel with purchasing a home. Veterans do not have to be first time homebuyers necessarily to qualify. Florida Housing supply’s these loans with lower interest rates to accommodate this special group of men and women. This program may be used in conjunction with Florida Assist.
Third, is the Housing Finance Association (HFA) Preferred Conventional Loan, it is a conventional (Fannie Mae only) 30 year fixed rate mortgage loan. This program helps to greatly reduce the mortgage insurance costs when compared to FHA loans. This program may also be combined with Florida Assist.
Fourth, is the Housing Finance Association (HFA) Preferred PLUS Conventional loan, it is a 30 year fixed first mortgage loan. If you are eligible for this program you automatically qualify for Florida Housing’s 3% – 5% grant down payment, which is non-payable, and borrowers may still receive closing cost assistance. The 3%-5% grant is only available with this program.
Lastly is the Mortgage Credit Certificate Program. This gives a federal tax credit to the borrower to be applied against federal tax liabilities they owe each year. By claiming a dollar-for-dollar reduction of income tax liability it reduces the amount of federal taxes owed. This incentive is capped at $2,000 but can be taken each year the borrower occupies the home as a primary residence and pay’s interest on the initial first mortgage loan. In some counties when the MCC is paired with one of the first time mortgage loans, they will allow you to take the remaining mortgage interest not credited and use it as a tax deduction. For example: In Palm Beach County a homeowner with a 3.5%, 30-year fixed rate mortgage of $125,000 approximately pays $4,336 in mortgage interest the first year. The HFA loan program combined with the Palm Beach County MMC allows $2,000 of the mortgage interest to be taken as a tax credit, with the remaining $2,336 to be used as a tax deduction.
The Following list of information was obtained using Floridahousing.Org’s First Time Home Buyers wizard, and is based upon a family of two or fewer people looking to purchase a first time home. Each of the persons that will be living in the home 18 years or older is asked to include their income into the equation to be eligible. The following findings are broken down by each of the South Florida counties of Martin, Palm Beach, Broward, Miami-Dade and Monroe.
For Martin County the program qualifying Income Limits may not exceed $65,640, which also applies to the qualifications of the Florida Assist income limits. The purchase price limit may not exceed $301,829. If you are purchasing a home within a Federally Designated Target area the purchase price can be up to $368,902. However, I was unable to find any listed Federally Designated Target areas in Martin County.
For Palm Beach County the program qualifying Income Limits may not exceed $78,720, which also applies to the Florida Assist income limit qualification.
The purchase price limit may not exceed $329,268. If you are purchasing a home within a Federally Designated Target area the purchase price can be up to $402,439.
Federally Designated Target area’s in Palm Beach County are listed here by their census tract numbers. You may view these areas by looking up corresponding county census maps and entering these tract areas: 14.04, 19.09, 22, 24, 26, 68.01, 82.01, 82.02, 83.01.
For Broward County the program qualifying Income Limits may not exceed $79,465, which also applies for the Florida Assist income limits. The purchase price limit may not exceed $329,268. If you are purchasing a home within a Federally Designated Target area the purchase price can be up to $402,439. Federally Designated Target area’s in Broward county are listed here by their census tract numbers you may view the areas by looking up corresponding county census maps and entering these tract numbers: 303.01, 304.02, 414, 415, 416, 417, 603.03, 805 and 1005.
For Miami-Dade County the program qualifying Income Limits may not exceed $77,855, which also applies for the Florida Assist income limits. The purchase price limit may not exceed $329,268. If you are purchasing a home within a Federally Designated Target area the purchase price can be up to $402,439. Federally Designated Target area’s in Miami-Dade county are listed here by their census tract numbers you may view the areas by looking up corresponding county census maps and entering these tract numbers: 4.08, 5.03, 7.03, 8.03, 9.03, 10.04, 14.01, 14.02, 15.01, 15.02, 17.02, 18.01, 18.03, 19.01, 19.03, 19.04, 20.01, 20.03, 20.04, 24.01, 24.02, 25, 26, 28, 30.01, 30.03, 30.04, 31, 34, 36.01, 36.02, 37.01, 37.02, 39.07, 44.02, 49.01, 52.01, 52.02, 53.01, 53.02, 54.02, 57.03, 66.02, 93.10, 102.06, 106.02, 108, 109, 110.01 and 113
For Monroe County the program qualifying Income Limits may not exceed $103,395, which also applies for the Florida Assist income limits. Purchase price limit may not exceed $504,878. If you are purchasing a home within a Federally Designated Target area the purchase price can be up to $617,073. However, I was unable to locate any listed Federally Designated Target areas in Monroe County.
Hopefully this information can be useful in guiding you in your first time home buying process. If there is any questions or if you should need any assistance in setting up a search within any of the five South Florida Counties Water Vista Realty serves please don’t hesitate to contact any of our agents.
Please visit Florida Housing Finance Corporation website for further information and to find approved local lenders listed below: