First Time Home Buyer Program · Licensed in NJ · CT · FL · NMLS #1630225
First Time Home Buyer Program — Five Routes, Compared
The first time home buyer program is not one loan, it is five. FHA reaches down to a 500 score. Conventional wants 620 with 3% down. Zero down is on the table with VA and USDA if you are eligible. And if your tax return understates what you earn, Non-QM reads deposits instead. On top of whichever one fits, 5% down payment assistance is available from a 580 score.
Last updated August 2026 · reviewed by a licensed mortgage broker
FHA And VA
FHA, Conventional
Needed To Qualify
Primary Residence
Your Answer Right Here
First Time Home Buyer Program Options — New Jersey, Connecticut & Florida, 2026
If you are buying your first home, you likely qualify for more than one loan program, and picking the right one comes down to your credit score, your savings, and how you plan to use the home. Our First Time Home Buyer Program is not a single loan — it is a side-by-side comparison of FHA, conventional, VA, USDA, and Non-QM financing, run against your actual numbers so you can see which one puts more money in your pocket at closing and over time.
Most first-time buyers we work with land in one of three places. Buyers with a credit score under 620 typically start with FHA, since it accepts scores as low as 500. Veterans and active-duty service members almost always come out ahead with a VA loan because of the 0% down payment and no monthly mortgage insurance. Buyers purchasing in an eligible rural or suburban area often qualify for USDA financing at 0% down as well. On top of any of these, our 5% down payment assistance program can cover a meaningful share of your down payment and closing costs. Mortgage-World.com (NMLS #1630225) is licensed in New Jersey, Connecticut, and Florida and can walk you through every program you qualify for at no cost. Call 888.958.5382 or apply free.
Side-by-Side Comparison
First Time Home Buyer Program — Credit Score & Down Payment by Loan Type
Every major first-time buyer loan option compared side by side for 2026.
| Loan Program | Min. Credit Score | Min. Down Payment | Mortgage Insurance | Best For |
|---|---|---|---|---|
| FHA | 500 (580+ for 3.5% down) | 3.5% (10% if 500–579) | Upfront + monthly MIP | Lower credit scores, smaller savings |
| Conventional | 620 (740+ for best pricing) | 3% (first-time buyers) | PMI, cancellable at 80% LTV | Stronger credit, long-term ownership |
| VA | 500 (lender overlays vary) | 0% | None (VA funding fee applies) | Veterans, active-duty, eligible spouses |
| USDA | 550 | 0% | Upfront + annual guarantee fee | Eligible rural & suburban areas |
| Non-QM | 600 alt doc | Typically 10%+ | Program-dependent | Self-employed, alternative income docs |
Program Deep Dive
FHA Loans for First Time Buyers
FHA remains the most common starting point in our First Time Home Buyer Program, mainly because the credit bar is so much lower than conventional financing. The Federal Housing Administration insures the loan, which is why lenders can accept scores down to 500 with 10% down, or 3.5% down at 580. The trade-off is mortgage insurance: FHA charges an upfront premium of 1.75% financed into the loan, plus an annual premium of roughly 0.55% that, in most cases, stays for the life of the loan if you put down less than 10%. Even so, FHA is usually the fastest and most affordable path into a home for buyers with limited savings. The HUD 203(b) program guidelines spell out the full eligibility framework.
FHA Credit Score Thresholds
A score of 580 or higher unlocks the 3.5% down payment option. Between 500 and 579, FHA still allows financing, but the required down payment jumps to 10%. Since individual wholesale lenders sometimes add overlays above the FHA floor, working with a broker who shops multiple lenders matters most for buyers near either threshold.
Program Deep Dive
Conventional Loans for First Time Buyers
Conventional loans follow Fannie Mae and Freddie Mac guidelines and require a stronger credit profile than FHA, but they reward that credit with lower long-term costs. First-time buyers with a 620 score or better can qualify, and programs like Fannie Mae’s HomeReady and Freddie Mac’s Home Possible allow as little as 3% down. Unlike FHA, PMI on a conventional loan is cancellable once you reach 20% equity, a real advantage for buyers planning to stay several years.
When Conventional Beats FHA
Once your score climbs past 680, conventional pricing usually starts to catch up to and then beat FHA, and by 740 it is typically the clear winner. The only way to know for certain is to run both scenarios against your real numbers, which is exactly what we do for every applicant.
Program Deep Dive
VA Loans for First Time Buyers
If you are a veteran, active-duty service member, or eligible surviving spouse, a VA loan is usually the strongest first-time buyer option available. Backed by the U.S. Department of Veterans Affairs, VA loans allow 0% down with no monthly mortgage insurance, which no other program on this list can match. Borrowers instead pay a one-time VA funding fee, often rolled into the loan, and some disabled veterans are exempt entirely. Minimum credit score requirements vary by lender, though we can generally work with scores as low as 500.
Program Deep Dive
USDA Loans for First Time Buyers
USDA financing, guaranteed through the USDA Rural Development single-family housing program, is one of the best-kept secrets among first-time buyer options. It allows 0% down in designated rural or suburban areas, which covers more towns than most people expect, especially outside dense city centers. USDA loans carry an upfront guarantee fee plus a modest annual fee, both lower than typical FHA mortgage insurance costs. A 550 minimum credit score keeps this program accessible for buyers rebuilding their credit.
Program Deep Dive
Non-QM Loans for Self-Employed First Time Buyers
Not every first-time buyer has a W-2 and two years of tax returns that reflect their true income. Non-QM loans, including bank statement and alternative income documentation programs, exist for this situation. With a minimum 600 credit score, self-employed buyers and small business owners can often qualify using 12 to 24 months of bank statements instead of tax returns. Down payments run higher than government-backed programs, typically starting around 10%, but it can be the only realistic path to approval when tax returns don’t tell the full income story.
Down Payment Assistance
Our 5% Down Payment Assistance Program
Saving for a down payment is usually the single biggest obstacle for first-time buyers, which is why our First Time Home Buyer Program includes a 5% down payment assistance option applied toward both your down payment and closing costs. Here is how it works, in plain terms:
How the 5% Assistance Program Works
The assistance amount is the lesser of 5% of the purchase price or the appraised value, applied on top of an FHA first mortgage. A minimum 580 FICO score is required, and there are no income limits. The assistance is structured as a repayable second loan — a 10-year, fully amortizing loan priced at your first mortgage rate plus 2%, rather than a forgivable grant. HUD-approved housing counseling is required for at least one borrower, and a 2-1 temporary rate buydown is not permitted with this program. It is one of several down payment assistance structures we offer, and our team will walk you through whether the 5% program or another option fits your purchase price and budget best.
Full Qualification Picture
What You Need to Qualify for the First Time Home Buyer Program
- Score as low as 500 (FHA/VA) up to 620+ (conventional)
- Two years of steady income history preferred
- Non-QM available for self-employed borrowers
- DTI flexibility varies by program
- 0% down on VA and USDA for eligible borrowers
- 3% to 3.5% down on conventional and FHA
- 5% down payment assistance available (580+ FICO)
- Gift funds accepted on FHA and conventional
- Pay stubs or two years of tax returns
- Two months of bank statements
- Government-issued ID and Social Security number
- DD-214 for VA loan borrowers
- Primary residence required on FHA, VA, and USDA
- USDA requires an eligible rural or suburban location
- FHA and conventional require a qualifying appraisal
- Single-family, condo, and townhome typically eligible
How It Works
Three Steps to Using Our First Time Home Buyer Program
Share your credit score range, income, and savings. No hard credit pull is required, so it won’t affect your score.
We compare FHA, conventional, VA, USDA, and Non-QM, and check whether the 5% down payment assistance improves your outcome.
With a pre-approval letter and a clear budget, you shop confidently and we stay with you through closing.
Before You Start
What Happens After You Apply
- You send the application
A few minutes online. No documents at this stage.
- A licensed loan officer calls you
Someone on our team covering your state.
- We ask for documents and pull credit
Only once you have decided to move forward.
- You get an approval to shop with
Typically back within the hour.
What Clients Say
Real Reviews From Our Clients
Here’s what a few of our clients said about working with Mortgage-World.com.
Common Questions Answered
Frequently Asked Questions — First Time Home Buyer Program
Related first-time buyer pages: First-time buyer Florida · First-time buyer New Jersey · First-time buyer Connecticut · Down payment assistance.
Related Resources
Which First-Time Route Is Yours?
Mortgage-World.comStart with three questions
No credit pull, no documents yet.
Your answers carry over — you won’t be asked twice.
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- Licensed in
- NJ · CT · FL
- Broker license
- NMLS #1630225
- Florida license
- MLB 1987
- Family owned since
- 2017
- Office
- Ridgefield, NJ
The assistance can sit on top of any of them
Your credit, what you have put aside, and the town you are buying in. A licensed loan officer will work out which of the five you clear, and whether the 5% assistance can sit on top of it.
Written and reviewed by Chris Luis, Broker/Owner of Mortgage-World.com, NMLS #1630225. About the author