If you’ve owned a home before, it would be reasonable to assume that first-time-homebuyer programs are no longer an option. But that isn’t always the case. Some programs consider you a first-time buyer if you haven’t owned a principal residence within the past three years, while others provide additional exceptions. Understanding how those definitions work could uncover financing or assistance possibilities you might otherwise overlook.
A useful place to begin is with the three-year rule used by some first-time-homebuyer programs. Under that definition, someone who has not owned a principal residence during the previous three years may be treated as a first-time buyer—even if that person owned a home earlier in life.
Some programs also contain provisions that may apply to certain single parents, displaced homemakers, or people with particular previous ownership circumstances. Because definitions aren’t identical from one program to another, the better question isn’t simply, “Have I ever owned a home?” It’s, “Do I meet the definition used by this particular program?”
- Consider when you last owned a principal residence—not simply whether you’ve ever owned one.
- Look at the eligibility definition for each specific program rather than assuming the rules are the same.
- Ask whether any special provisions may apply to your previous ownership circumstances.
Once eligibility is established, there may be several worthwhile possibilities to explore:
- Low-down-payment options that may make the initial cost of buying more manageable.
- Down payment assistance available through qualifying state, local, nonprofit, or other programs.
- Closing cost assistance that may help reduce some of the additional expenses of purchasing.
- Special conventional financing options for buyers who meet the applicable requirements.
- Homebuyer education and counseling that can make the financing and purchase process easier to understand.
- State and local programs offering assistance based on location and individual qualifications.
FHA and USDA loans are also worth discussing with a qualified lender, but they aren’t exclusively first-time-homebuyer programs. Each financing and assistance program has its own eligibility requirements, which may include factors such as income, credit, property type, location, or occupancy.
There can be quite a difference between assuming you don’t qualify and actually finding out. If homeownership is back on your horizon, I can help you identify the questions worth asking and connect you with knowledgeable mortgage professionals who can explain the programs that may fit your circumstances. Sometimes the path forward begins simply by discovering that a door you thought was closed may still be open.