Purchasing your first home is a milestone—and navigating mortgage options can feel overwhelming. This guide breaks down the primary loan programs available to U.S. first-time buyers in 2026.
FHA loans
Federal Housing Administration loans require as little as 3.5% down with credit scores from 580. They are popular among buyers with limited savings or shorter credit history. Mortgage insurance premiums (MIP) apply for the life of the loan unless you put 10% down, in which case MIP may cancel after 11 years.
Conventional 97 and HomeReady
Fannie Mae and Freddie Mac offer conventional loans with 3% down for qualified first-time buyers. These may require slightly higher credit scores than FHA but often have lower long-term costs if you can avoid lifetime mortgage insurance by reaching 20% equity.
VA loans
Eligible veterans, active-duty service members, and surviving spouses can access zero-down VA loans with no private mortgage insurance. Funding fees apply but can be financed into the loan.
USDA rural development
Properties in eligible rural and suburban areas may qualify for USDA loans with no down payment and competitive rates. Income limits apply based on area median income.
State and local assistance
Many states offer down payment assistance grants, forgivable loans, or tax credits. We help clients identify programs in their state during consultation.
Steps to prepare
- Check credit reports and improve scores if needed
- Save for down payment and closing costs (typically 2–5% of price)
- Get pre-approved before house hunting
- Budget for maintenance, taxes, and insurance beyond the mortgage payment