Are you a first-time home buyer in North Carolina? Clear Rate Mortgage is here to help you get started with flexible loan options and local programs that make the process easier.
From FHA loans with low down payments to VA loans for veterans and other financing choices, we’ll help you find what fits.
Some programs may also offer down payment assistance to make homeownership more accessible. Pre-qualify now or call us at 888-573-2640 to get started.
Who qualifies as a 1st time home buyer in North Carolina?
The first step to accessing specialized mortgage programs and assistance is knowing if you qualify as a first-time home buyer in North Carolina.
You might think this status only applies to people who've never owned a home, but the rules are more flexible than that.
Definition and eligibility criteria
North Carolina follows HUD guidelines to define first-time homebuyers. You can qualify if you haven't owned a principal residence within the past three years.
This means you're still eligible for first-time buyer benefits even if you sold your home more than three years ago.
The three-year rule has some key exceptions. You might still qualify as a first-time home buyer in North Carolina if you are:
- An eligible veteran with an honorable discharge
- A homebuyer purchasing in specially designated "targeted census tracts"
Clear Rate Mortgage can help you understand the simple eligibility rules. To qualify for North Carolina's first-time homebuyer programs, you need to:
Buy a home in North Carolina, move in within 60 days after closing, and be a permanent legal resident of the United States.
Most programs need you to complete a homebuyer education course that teaches you about the home-buying process.
Income and credit score requirements
Income limits change based on your county and household size in most North Carolina first-time homebuyer programs.
Different programs look at income in various ways; some check only the borrower's income while others examine the entire household's earnings.
The NC Home Advantage Mortgage looks only at the borrower's income, which your lender will verify. Programs like NC 1st Home Advantage Down Payment look at household income, which counts earnings from everyone 18 or older living in the home, except full-time dependent students.
Credit score requirements are reasonable. Most North Carolina first-time homebuyer programs need a minimum score of 640, lower than the state's average of 709 in 2024. Manufactured homes need a slightly higher score of 660.
Why it matters for loan qualification
Your status as a first-time home buyer in North Carolina opens up great financial assistance options. Clear Rate Mortgage knows these benefits make buying a home more achievable.
Down payment assistance programs are the biggest advantage. First-time buyers can get up to $15,000 through the NC 1st Home Advantage Down Payment program.
This help comes as a 0% deferred second mortgage that's forgiven 20% per year at the end of years 11-15, with full forgiveness after 15 years.
The benefits are even better for lower-income buyers (80% or less of area median income), who can receive up to $50,000 in down payment help. Some cities offer more generous assistance, like Durham's $80,000 for qualified buyers.
Clear Rate Mortgage guides first-time buyers through these qualification requirements to help them get the most benefits and find an efficient path to homeownership.
Best loan options for first time home buyers in NC
Looking at mortgage options as a first-time home buyer in North Carolina can make your dream of owning a home come true. Our team at Clear Rate Mortgage helps first-time buyers find the right financing solution that fits their needs.
FHA Loan: Low down payment and flexible credit
FHA loans top the list for many first-time buyers in North Carolina. These government-backed mortgages give you flexibility with down payments starting at just 3.5% if your credit score is 580 or higher.
You might still qualify with a credit score as low as 550 if you can make a bigger down payment.
North Carolina's first-time buyers love that sellers can help with closing costs, which cuts down their upfront expenses.
FHA loans also come with competitive interest rates that beat conventional options, so your monthly payments stay manageable.
VA Loan: For veterans and active-duty military
Military veterans and active-duty service members can tap into one of the best first-time buyer programs through VA loans. These loans need no down payment and usually beat conventional loan rates.
VA loans stand out because they don't need private mortgage insurance (PMI), which means lower monthly payments.
This makes buying a home easier for qualified first-time buyers in North Carolina who have military backgrounds. Our team at Clear Rate Mortgage can check if you qualify based on your service record.
USDA Loan: For rural homebuyers
First-time buyers eyeing homes in rural North Carolina should check out USDA loans. These loans need no down payment and come with great rates and flexible credit requirements.
The USDA program helps low and moderate-income families buy homes in eligible rural areas.
Payment assistance can lower interest rates to as little as 1% based on your income. Many rural first-time buyers find this option fits their budget perfectly.
Conventional Loan: With first-time buyer perks
Conventional loans might have stricter requirements than government options, but they offer special advantages for qualified first-time buyers in North Carolina.
You can start with just 3% down, and you'll have a chance to cancel mortgage insurance once you build 20% equity.
Our team at Clear Rate Mortgage knows choosing between these options feels like a lot.
We specialize in helping North Carolina's first-time homebuyers create an efficient path to homeownership that matches their financial situation and goals.
Other Loan Solutions to Explore With Clear Rate Mortgage
Beyond standard first-time buyer loans, Clear Rate Mortgage offers additional financing options that can fit more unique needs especially if you're navigating a competitive market or considering future flexibility.
Jumbo Loans for Higher-Priced Homes
If you're eyeing a home above conventional loan limits, a jumbo loan could be the right fit. These loans let you borrow more often needed in high-cost North Carolina markets with competitive fixed or adjustable rates.
Reverse Mortgages for Eligible Seniors
If you're a homeowner aged 62 or older buying a new primary residence, a reverse mortgage purchase option can help you use your home equity strategically without monthly mortgage payments. Our team can walk you through this special type of financing.
Home Construction Loans
Planning to build your dream home from the ground up? We offer home construction loans that cover both the building phase and the final mortgage, so you don’t need to secure separate financing.
Fix & Flip and Rehab Loans
Thinking about buying a property that needs renovations? Our fix & flip and rehab loan options are designed to finance both the purchase and improvement costs ideal for investors and buyers looking for value-add opportunities.
Clear Rate Mortgage is committed to helping North Carolina homebuyers match with the right loan even beyond traditional first-time buyer options.
Whether you’re building, investing, or purchasing a high-value property, we’ll help you move forward with the right strategy.
Other financing options worth exploring
Smart first-time home buyers have several alternative financing options beyond traditional mortgages that could better suit their needs. Clear Rate Mortgage shows you these valuable but lesser-known paths to homeownership.
Bank Statement Loan: For self-employed buyers
Tax write-offs often make it hard for self-employed buyers to qualify for conventional loans due to reduced documented income.
Bank statement loans solve this by looking at 12-24 months of personal or business bank statements instead of traditional income proof.
Business owners, freelancers, and independent contractors who've worked independently for at least two years will find this option perfect.
Bridge Home Loan: For buying before selling
Found your dream home before selling your current one? Bridge loans give you short-term financing that connects your new property purchase with your existing home's sale.
These loans typically last 3-12 months. North Carolina's first-time home buyers can make stronger, non-contingent offers and skip temporary housing arrangements.
DSCR Home Loan: For investment property buyers
DSCR (Debt Service Coverage Ratio) loans look at your property's potential rental income rather than personal finances.
These investment property loans usually need a 20-25% down payment and check if the property's income covers its expenses.
Fix & Flip and Rehab Loans: For renovation projects
These special loans cover both purchase and renovation costs for properties that need work. You can get loan-to-value ratios up to 70% of after-repair value with competitive interest rates starting around 8.5%. These options help investors reshape properties and boost returns.
HELOC and Cash-Out Refinance: Tap into home equity
Your property's equity becomes accessible through HELOCs (Home Equity Lines of Credit) or cash-out refinancing.
HELOCs give you flexible revolving credit, while cash-out refinancing swaps your current mortgage for a larger one and hands you the difference in cash.
Seller-Paid Buydown: Lower your interest rate
This smart option lets sellers pay points upfront to cut your interest rate temporarily or permanently. A 2-1 buydown cuts your rate by 2% the first year and 1% the second year.
This makes early homeownership more affordable without needing a price reduction.
Clear Rate Mortgage helps North Carolina's first-time home buyers explore all financing options, including these alternatives that might give you the flexibility your situation needs.
Clear Rate Mortgage Supports Every 1st Time Home Buyer in North Carolina
At Clear Rate Mortgage, we understand how big this decision feels especially if you're a 1st time home buyer in North Carolina.
That’s why we focus on making the process clear, fast, and personal. From your first question to the day you close, we keep communication simple and helpful, without overwhelming you with numbers or promises we can't keep.
We don’t believe in one-size-fits-all answers. Instead, we listen closely and guide you toward the loan option that fits you.
Whether you’re self-employed, building a new home, or just starting out with limited savings, our team is here to walk beside you, not just talk to you.
You deserve a loan experience that puts your needs first. With Clear Rate Mortgage, you'll get answers when you need them, guidance you can trust, and a team that values transparency above all.
Ready to take the next step? Call us at 888-573-2640 or pre-qualify now we’re here when you’re ready.
FAQs
1. What should first-time home buyers avoid during the mortgage process?
It’s best to avoid big purchases or taking on new debt until after closing. These actions can affect your loan approval and delay the process.
2. Can I buy a home with student loan debt as a first-time buyer?
Yes, you can still qualify even if you have student loans. Lenders look at your overall ability to manage payments, not just your loan balances.
3. How long does it take to buy a home for the first time?
The timeline depends on your preparation and the home you choose. Having your paperwork ready can make things move faster.
4. Do first-time buyers need a real estate agent?
Working with a local agent can help you find homes that match your needs. They also guide you through offers, inspections, and closing.
5. Is it possible to buy a home without a perfect credit score?
Yes, many loan options work with less-than-perfect credit. What's important is showing you can handle payments now and moving forward.
