Low-Income Home Buying Programs Explained

Low income home buying program is a program that helps low-income buyers can qualify for a mortgage and buy a house. In other words, is a program designed to help home buyers who might not otherwise qualify for a loan.

Most programs in low-income home buying are sponsored or insured by the government in some way, such as the programs listed below.

Freddie Mac and Fannie Mae

Freddie Mac and Fannie Mae are private companies sponsored by the U.S. government. Both organizations contribute indirectly to the lower middle-income families purchase homes, and in similar ways.

Freddie Mac

Freddie Mac is the Federal Home Loan Mortgage Corporation. This organization was chartered by Congress in 1970. Freddie Mac supports the secondary mortgage market by purchasing residential mortgages and sell them to investors on Wall Street. This increases the availability and affordability of mortgages for low-and middle-income Americans.

For more information, http://www.FreddieMac.com

Fannie Mae

Fannie Mae stands for Federal National Mortgage Association (FNMA). Congress chartered the organization in 1938. According to their website, Fannie Mae, "provides financial products and services that enable low, moderate, and middle-income families to buy homes of their own."

For more information, http://www.FannieMae.com

Federal Housing Authority

The Federal Housing Authority (FHA) also supports low-income home purchases in the United States was created as part of the FHA National Housing Act of 1934. The FHA supports the industry of home purchase, providing mortgages. This in turn helps low-income home buyers qualify for mortgages that might otherwise not receive.

For more information, http://www.FHA.gov

Veterans Administration Home Loans

Veteran's Administration (VA) helps low-income home buyers (and all home buyers, for that matter), guaranteeing loans provided by mortgage lenders. The VA does not actually make direct loans. The VA home loan program is reserved for military veterans and their spouses. Applicants to the program must obtain a Certificate of Eligibility which in turn present to their mortgage lender.

For more information, http://www.homeloans.va.gov

Rural Housing Authority

The Rural Housing Authority (RHA) is another government organization that can help low-income home buyers in certain situations. The RHA is part of the United States Department of Agriculture (USDA). Unlike the organizations mentioned above, the RHA actually makes direct loans to home buyers, among other things. They also ensure regular commercial loans for buyers in rural areas.

For more information, http://www.rurdev.usda.gov/rhs

State-Sponsored Programs

In addition to federal programs, there are many low-income programs, the purchase of the house offered by state governments. An example would be the Michigan State Housing Development Authority, which "makes low-interest loans available through [their] network of lenders with experience." Many other states offer similar programs. There are too many government programs to list in this article, but you can learn more about them by searching online for home buying programs in your state.

*, Brandon Cornett. You may republish this article online if you keep the author byline and active hyperlinks below ....