If you are buying a home in the state of New York and you are a first-time homebuyer, you might be able to take advantage of a SONYMA mortgage. This stands for the State of NY Mortgage Association. This agency provides five different mortgage programs for first-time homebuyers. The requirements for each program differ. Understanding your options can help you make the right choice for you and your family.
Homes for Veterans Program
The Homes for Veterans Program is the only SONYMA mortgage that does not require the borrower to be a first-time homebuyer. If you are a veteran, you can also use this program to move into a new home, even if you already own a home. Veterans are able to take advantage of any of the SONYMA programs available. If you are a first-time homebuyer, your discharge status does not matter unless you were in the National Reserves. If you did serve in the Reserves, you need an honorable discharge to be eligible.
If you have owned a home in the past, you may still qualify for the program. However, not only must you have served in the military – you must have an honorable discharge. As a veteran, you may receive down payment assistance and lower than average interest rates.
The RemodelNY loan program helps first-time homebuyers only. It helps them not only purchase a home, but also renovate it. This program provides 97% of the value of the home after the improvements are made. If a determination cannot be made regarding the future value of the home, the purchase price plus the cost of the repairs included in the loan are determined. There is no maximum enforced for the allowable repairs, however, at least $1,000 in minimum repairs must be done. This program allows most renovations that are not considered “luxurious.”
Achieving the Dream
This program provides low-income borrowers with financing with a low down payment. The financing is available on single-family properties as well as 2-units, condos, and manufactured homes. This program features a low interest rate, 97% financing, and no prepayment penalties. In addition, borrowers only need to contribute 1% of their own money and can obtain down payment assistance in conjunction with this program.
In order to qualify, you must be a first-time homebuyer. You must also have a good credit profile, steady income, and be able to prove that you can afford the mortgage. The home can be either existing or new construction. It cannot, however, exceed the SONYMA limits.
Construction Incentive Program
Borrowers who wish to purchase a newly constructed home in the state of New York can take advantage of the Construction Incentive Program. This program provides 97% financing for first-time homebuyers. It also only requires the borrower to contribute 1% of his or her own funds. There are no prepayment penalties and the only term allowed is a 30-year term. In order to qualify for the program, borrowers must meet the basic SONYMA mortgage requirements, including:
- Hold a steady job
- Have steady income
- Have decent credit
- Be able to prove you can afford the mortgage and your other monthly debts
- Have enough money for the down payment and/or closing costs
Eligible properties for this program include single-family homes, condos, and 2-unit homes – all of which must be newly constructed.
Low-Interest Rate Program
The Low Interest Rate Program provides financing for low income families who are also first-time homebuyers. The program provides up to 97% financing on homes from one to four units; however, properties with more than 2 units may only secure 90% financing. Borrowers must contribute 1% of their own money for this program and secure a 30-year term.
As is the case with any other SONYMA program, you must meet the qualifying requirements of the program including good credit, steady income, and prove you can afford the loan. You also must not make more than the allowable income amount for the State of New York Mortgage Association programs.
Each of these programs may be used with one another, especially if you are a veteran. The State of New York only provides these programs in specific areas. In order to determine if a property is eligible, you have to contact the SONYMA hotline. As a definition, the “target areas” are areas that need economic stimulation. The state provides the assistance in order to help build the areas up.