Owning a house is oftentimes the most important and expensive decision one makes. Because there are conscious people and groups who don’t want others to pay as much, there are plenty of affordable housing programs to choose from. These can also be ideas used to give people more affordable rates for renting apartments or homes in certain areas. For this reason, in this article we will be discussing the topic of affordable housing loans you should know about so if you’re planning on buying a house, it will be easier for you and less stressful.

By definition, affordable housing is housing which is affordable for people who make a medium income. You still need to qualify for these loans so make sure your credit is high enough as it needs to be for a regular loan. Below are five examples of these affordable housing loans.

FHA Loans

In 1934, the United States created the Federal Housing Administration to promote the ownership of a home. Because of inflation, homes will be relatively the same price

USDA Loans

For suburban and rural people looking to purchase a home in these areas, a USDA loan gives you the benefit of zero down payment on your mortgage loan. These are categorized as affordable housing because it allows anyone with good credit the ability to purchase and live in a home as opposed to an apartment. The down payment is one of the major obstacles to the home purchase process, but removing it gives buyers a better chance and cushion on their finances.

FHA 203K Home Renovation Loans

This can be considered a branch from the FHA tree. An FHA 203K Home Renovation Loan allows the borrower to have enough capital for both the purchase and the renovation of a home. The loan is most often given to people who choose to purchase and renovate a run-down or older house that is typically damaged. It is funded by 203K lenders but is backed by the Federal Housing Administration.

VA Loans

The Department of Veteran’s Affairs (VA) provides this loan to give members of the military service, veterans, and certain spouses of previous military personnel in order to purchase a home with zero down payment. They’re given to individuals by private lenders and are also backed by the Department of Veteran Affairs. Conventional loans typically require a 20% down payment so this is a much better option if you fit the criteria.

Ready Buyer Home Path Mortgage

This is more of an all-around home-buying process education program because there are so many resources involved. You’ll have access to a list of foreclosed homes that are for sale. It’s also an education program for the homebuyer which also can provide assistance with closing costs to first-time buyers. It also a good choice if you’re purchasing the property as an investment.

In conclusion in this article we discussed the topic of affordable housing loans and how they help people with medium to low income. Each of these has different benefits as well as different drawbacks, but which loan you choose will depend only on your specific situation. You may be in a dilemma being both a first time home buyer and an ex NAVY Seal so which loan to get, the FHA or VA will depend on which one ends up giving you more leverage for a lower interest rate. Before you move forward it would be wise for you to contact a professional like someone from Chenoa Fund Loans at the Chenoa Fund.