Vermont Mortgage Overview
Vermont is an affordable place to live with
an average home value of $217,500. It's a great place for first-time and
subsequent homebuyers. Vermont has many programs that help first-time
homebuyers who don't qualify for the traditional financing programs listed
Vermont conventional loans
are traditional loans. Borrowers need a 660 credit score to qualify. If you've
never owned a home before you need a 3 percent down payment. If you've owned a
home, you need a 5 percent down payment. Anyone who puts down less than 20
percent will pay Private Mortgage Insurance, but only for the time you owe over
80 percent of the home's value. You can ask the lender to cancel the insurance
once you get to that point.
Vermont FHA loans
FHA loans are a conventional
loan alternative. Borrowers need just a 580 credit score to qualify. With this
score, you can put down 3.5 percent and some of the money can be down payment
assistance or gift funds. You may even qualify with a 500 - 579 credit score
but with a 10 percent down payment. 3.5 percent of the funds must be yours. FHA
loans charge mortgage insurance for the life of the loan.
Vermont VA loans
VA loans are for veterans of
the military or currently serving members if you have 181 days served in
peacetime or 90 days during wartime. VA loans don't require a down payment and
you can get approved with a credit score as low as 620 and a debt ratio of as
high as 50 percent. VA loans don't charge mortgage insurance but there is an
upfront funding fee.
Vermont USDA loans
USDA loans are for
low-to-moderate income families who don't qualify for the above programs. USDA
loans provide 100 percent financing, but you need a 640 credit score and 41 percent
debt ratio to qualify. You must live within the USDA boundaries, which isn't as
'rural' as it sounds. There are many areas of Vermont that qualify.
Programs in Vermont
This no-cost loan provides up to $5,000
for the down payment and closing costs on a home. The loan has no interest and
is deferred until you sell the home or refinance your current loan.
If you fall within the income limits,
you may get approved for the ADVANTAGE program which provides low interest
rates and low closing costs including waiving the Vermont Property Transfer
Tax. There are low down payment options to make it easy for anyone to qualify.
Mortgage Credit Certificate
homebuyers can qualify for a certificate to get up to a $2,000 tax credit on
the interest you pay each year on your mortgage. The certificate lasts for the
life of the loan. This puts more money in your pocket, making it easier to own
The MOVE MCC program combines the
Mortgage Credit Certificate program with a low down payment program with simple
qualifications. Only first-time homebuyers qualify.
The MOVE program is a low-cost first
mortgage that has low down payment options and waves the Vermont Property
Transfer Tax on the sale.