Down Payment Assistance Programs for First-Time Homebuyers in New Mexico

New Mexico, dubbed as “The Land of Enchantment,” is home to stunning landscapes with Carlsbad Caverns being one of them. The state has a rich cultural heritage, and diverse outdoor activities make it a popular destination for holiday seekers.

The one market in New Mexico which is facing numerous challenges is its housing sector. It is marred by high mortgage rates and limited inventory which makes it difficult for prospective homebuyers, especially when households are spending over 30% of their income on housing.

However, down payment assistance programs are playing an important role in helping individuals alleviate some financial burdens and making homeownership more accessible for those struggling to afford the rising costs in the state.

Looking for Assistance in a Specific Part of New Mexico?

Individuals often get overwhelmed by down payment costs and this is where these assistance programs facilitate homeowners as they provide assistance in the form of grants, mortgages, or forgivable loans. This page will take a look at the state and local down payment assistance programs available to first-time homebuyers in New Mexico.

Down Payment Assistance in New Mexico

It can be overwhelming for potential homeowners to get caught up with down payments in New Mexico particularly when they could be reportedly paying up to $10,764. The figures reflect the financial challenges faced by first-time homebuyers in the state. This is why the New Mexico Mortgage Finance Authority (MFA) is providing relief initiatives to make homeownership affordable for the citizens.

FirstHome Program

The FirstHome Program is a key initiative that assists first-time homebuyers with low to moderate incomes who haven’t owned a home for the past three years.

Fundamentals

• Assistance Type: First mortgage loan
• Sponsor: New Mexico Mortgage Finance Authority (MFA)
• Assistance Amount: Upto 4% of home purchase price

Eligibility Requirement:

• The applicant must not have purchased a home or made it a primary residence in the past three years.
• The applicant should make the purchased house their primary residence within 60 days of closing.
• The purchased house should not be used for income generation.
• The borrower should have a minimum credit score of 620
• The applicant should contribute $500 from their own funds into the house (gifts or any items are not acceptable).
• The applicant should undergo a pre-purchase homebuyer counseling session through MFA’s online program or a HUD-approved agency.

NextHome Program

The NextHome Program provides financial assistance to first-time buyers and non-first-time homebuyers to reduce the upfront costs associated with purchasing a home.

Fundamentals

• Assistance Type: Forgivable grant
• Sponsor:  New Mexico Mortgage Finance Authority
• Assistance Amount: 3% of the first mortgage loan amount

Eligibility Requirements

• Homebuyers have to make the purchased property their primary residence within 60 days of closing.
• The borrower should have a minimum credit score of 620.
• Homebuyers should contribute at least $500 from their own funds
• The maximum purchase price limit of the house should be $350,000
• The applicant’s household income limit should be $75,000 or less

New Mexico Down Payment Assistance Program FAQs

What down payment assistance programs are available for first-time homebuyers in New Mexico?

The New Mexico Mortgage Finance Authority (MFA) offers several down payment assistance programs for first-time homebuyers including FirstHome and NextHome initiatives which cover a certain portion of your costs.

What are the eligibility requirements for these programs?

Eligibility requirements may vary but they usually include first-time homebuyer status, Minimum credit score of 620, income limits, completion of a homebuyer education course, and property must be owner-occupied primary residence.

Disclaimer: This article is for informational purposes only and should not be considered as legal or financial advice. Please consult an attorney, mortgage lender, or CPA for guidance on your specific situation.