A Guide For First-Time Home Buyers In Kansas: Loans And Programs To Know

Kansas is a beautiful state with a low cost of living and low housing costs compared to many places in the United States. So, it is no wonder that so many people are interested in buying a house there. Kansas even has several assistance programs to help you get a mortgage and purchase the home of your dreams.

If you’re a first-time home buyer hoping to buy a home in Kansas, keep reading to see if one of these programs might benefit you.

Here are a few important statistics on Kansas home buyers:

In most of the programs available, an individual qualifies as a first-time home buyer in Kansas if they have not owned any property in the prior 3 years.

Once you determine how much house you can afford, it’s time to find a mortgage. There are several nationwide first-time home buyer loans for home buyers in Kansas:

• FHA loans
• VA loans
• USDA loans

FHA loans

FHA loans allow home buyers to secure a mortgage with only a 3.5% down payment, assuming that the borrower has a credit score of 580 or higher. This loan can be for the entire value of a home and FHA loans can be made for people with slightly lower credit scores with a higher down payment. This is a great option for home buyers without a lot of savings for a down payment.

VA loans

VA loans are available exclusively to members of the military and their qualifying family members. VA loans are available for up to the full value of a home – no down payment necessary. Even if there is no down payment, there is a VA funding fee of 1.25% – 2.5% of the loan value.

VA loans also have some of the lowest closing costs of any loan. This is a great option for members of the military without a lot of savings for a down payment who may be moving around or just starting out in a permanent location.

USDA loans

USDA loans were created to help encourage home buyers to move to rural areas. These loans can cover 100% of the home’s value – meaning no down payment necessary. However, they are very limited. The home must be in a designated rural area and the household income cannot exceed 115% of the median income in the area where the home is located.

This loan is a great option if you have a low to medium income and want to buy a home in a rural area. If you’re able to work remotely and are looking to move out of the city, this could be an option for you.

There are several first-time home buyer programs, closing costs and down payment assistance programs available in Kansas:

KHRC’s First-Time Home Buyer Program

The Kansas Housing Resources Corporation (KHRC) offers several home buyer programs. The KHRC’s first-time home buyer program provides a 0% interest loan for up to 20% of the home’s purchase price. The loan is forgiven if the home buyer remains in the home for 10 years.

To qualify, the home buyer must:

• Be a first-time home buyer.
• Purchase a home located in Kansas but not in Topeka, Lawrence, Wichita, Kansas City, or Johnson County.
• Have income at or below 80% of the county median income.
• Qualify for a mortgage with an approved lender.
• Make an investment of 2% but no more than 10% of the sale price from their own funds.
• Property must pass an inspection.

Kansas DPA Program

The Kansas Down Payment Assistance Program provides down payment assistance in the form of a grant as well as a 30-year fixed mortgage.

To qualify, the home buyer must:

• Have a credit score of at least 640
• Have income below the limit
• Be purchasing a single family detached home, duplex (provided one unit owner occupied), condominium, townhome, or manufactured housing.
• The home must have purchase price under $647,200

Homeownership Set-Aside Program

The Homeownership Set-Aside Program provides down payment, closing cost and repair assistance to first-time homebuyers. This assistance is a grant, which is forgiven if the home buyer remains in the home for 5 years.

To qualify, the home buyer must:

• Be buying a home in Kansas, Colorado, Nebraska, or Oklahoma.
• Earn at or below 80% of the Area Median Income.
• Qualify for a mortgage with FHLBank.

There are also several first-time home buyer programs that are location-specific in Kansas:

Leavenworth

Leavenworth is a city in the Kansas City metropolitan area. The city offers a CDBG Home Ownership grant that provides up to $8,000 to qualified applicants purchasing a home in Leavenworth. This grant is forgiven if the buyer remains in the home for 5 years.

To qualify, the home buyer must:

• Must not have owned a home in the previous 5 years.
• The home must be located in Leavenworth.
• The owner must occupy the home.
• The home cannot be located in the 100-year flood plain.
• The home must pass a Housing Quality Standards Inspection.
• Sign a lien stating the buyer will reside in the home and not change title for 5 years.

Topeka

Topeka is the capital of Kansas. The city of Topeka offers the Topeka Opportunity To Own (TOTO) Program. This program offers $10,000 toward your down payment.

To qualify, the home buyer must:

• Have a minimum of $500 to put toward down payment.
• Be purchasing a home in the city of Topeka.
• Not own any other property at the time.
• Select a home with a sales price not exceeding $75,000.
• Pass a budget evaluation.
• Attend 12 hours of home buyer education.
• Be approved for a mortgage by an approved lender.

Here are a few frequently asked questions for first-time home buyers in Kansas.

Does Kansas have a first-time home buyer program?

Kansas offers 30-year fixed mortgage and down payment assistance programs for first-time home buyers who meet the qualifications.

How do I get a first-time home buyer grant in Kansas?

Work with your lender to determine which assistance grants you might qualify for. Fill out all applications in advance for best chances of success.

What credit score is needed to buy a house in Kansas?

Most home buying programs require a credit score of at least 620. A few programs require a credit score above 660. Double check with your specific program to be sure that you qualify.

Who qualifies as a first-time home buyer in Kansas?

First-time home buyers are typically considered individuals who have not owned property in the prior 3 years.

What size down payment do I need to buy a house in Kansas?

There are a few home buying programs in Kansas that will enable you to buy a home with no down payment, though you may still owe some closing costs. If you do not qualify for a zero down payment program, the lowest down payment option would be an FHA loan, which has a 3.5% minimum down payment.

Kansas is a great place to buy a home, and there are many assistance programs available to assist you in your home buying process. If you are ready to move, get started on the application process today.