First-Time Homebuyer Programs in Idaho

The down payment on a new home often presents the biggest hurdle for first-time homebuyers. In Idaho, with an average home value of $452,787, a down payment of $90,557 is needed to avoid private mortgage insurance.

Fortunately, first-time homebuyer programs in Idaho can help you achieve homeownership. Mortgages that allow for lower down payments usually have income requirements and require mortgage insurance. MoneyGeek explores several state-specific and government-backed first-time homebuyer programs for people from different financial backgrounds.

Idaho offers grants and loans to assist first-time homebuyers in covering down payment and closing costs. To help you find the best option for your needs, we compiled the first-time homebuyer programs offered by Idaho Housing and Finance Association (IHFA).

The Idaho Housing Home Loans program offers affordable, fixed-rate mortgage options for first-time and repeat homebuyers. It provides various loan types, including conventional, FHA, VA and USDA loans. Idaho Housing also offers down payment and closing cost assistance and low or no mortgage insurance options. Idaho Housing partners with local lenders to ensure loan servicing remains within Idaho.

The Idaho Housing Down Payment Assistance program helps homebuyers cover the upfront costs of purchasing a home by offering up to 7% of the sales price for down payment and closing costs. This assistance can reduce the personal financial burden for eligible borrowers, allowing them to contribute as little as 0.5% of the home’s price from their own funds. This makes it easier for homebuyers to secure affordable housing in Idaho, particularly in an environment of rising home prices.

Aside from statewide first-time homebuyer programs in Idaho, there are also city-specific programs available to help you pursue homeownership in a city of your choosing. Check out the table below for some of the cities in Idaho that provide first-time homebuyer programs for potential residents.

Zero-down-payment loan programs in Idaho allow you to purchase a home without putting any money down. USDA and VA loans are two government-backed options that do not require a down payment.

USDA loans are designed to assist rural and suburban homebuyers in securing affordable housing. They are issued by the U.S. Department of Agriculture and aim to enhance rural prosperity by providing financial support for home purchases in eligible areas.

These loans offer significant benefits, including the possibility of no down payment, competitive interest rates and reduced mortgage insurance costs. They are tailored to help individuals with low to moderate incomes purchase homes in designated rural areas. The USDA backs these loans, ensuring lenders can offer more favorable terms to qualified applicants.

To qualify for a USDA loan, your property must be located in a USDA-eligible rural area with a population of less than 35,000. The property size should not exceed 2,000 square feet. You must also meet specific income limits based on your location. For example, in Adams County, Idaho, the income limit for a four-person household is $62,000, while in Teton County, Idaho, it is $79,500.

VA loans are a home financing option issued by the U.S. Department of Veterans Affairs for veterans, active-duty service members and certain members of the National Guard and Reserves. These loans are designed to help those who have served the country achieve homeownership more easily.

What makes VA loans particularly attractive is their no-down payment requirement, which can significantly lower the initial costs of buying a home. VA loans also do not require private mortgage insurance (PMI), further reducing monthly payments. They generally offer lower interest rates than private loans. In Idaho, as of November 2024, the APR for a 15-year fixed-rate VA loan is 6.25%, while a 30-year fixed-rate VA loan has an APR of 6.71%.

To qualify for a VA loan, you must meet certain eligibility criteria, including specific length of service or service commitment, duty status, and character of service. Additionally, you need to meet income limits based on your location. A valid Certificate of Eligibility (COE) is also required to demonstrate your qualification for the loan.

First-time homebuyers in Idaho can take advantage of low-down-payment loan programs that allow them to finance their home with a down payment of 3.5% or less. These programs include conventional, FHA and FHA 203(k) loans.

FHA loans and conventional loans are often compared as they are the two most common mortgage types. FHA loans require a minimum down payment of 3.5%, while conventional loans can require as low as 3% for first-time homebuyers. Conventional loans typically have stricter credit score and debt-to-income ratio requirements than FHA loans.

Current interest rates in Idaho show that the APR for a 15-year fixed-rate conforming loan is 6.06% as of November 2024. In contrast, the APR for a 15-year fixed-rate FHA loan is 6.64%. APRs on FHA loans can be higher due to additional fees and costs associated with government-backed loans.

You can use our FHA vs. conventional loan calculator below to help compare FHA and conventional mortgage programs and determine the best option for you.

We answered frequently asked questions about first-time homebuyer programs in Idaho to help you determine the best option and move closer to achieving homeownership.

Explore additional MoneyGeek resources for first-time homebuyers in Idaho to help you with the homebuying process.