First-Time Homebuyer Programs in Utah

The down payment on a new home is often the biggest hurdle for first-time homebuyers. In Utah, where the average home value is $517,550, you would need a down payment of $103,510 to avoid buying private mortgage insurance.

Fortunately, first-time homebuyer programs in Utah are available to help you achieve homeownership. Some mortgages even allow first-time homebuyers to put less down on a home, but these usually have income requirements and require mortgage insurance. MoneyGeek found several state-specific and government-backed first-time homebuyer programs for Texans from different financial backgrounds.

Utah provides grants and loans to assist first-time homebuyers in covering both down payment and closing costs. We've compiled the first-time homebuyer programs Utah Housing Corporation offers to help you find the best option for your needs and situation.

The FirstHome and HomeAgain programs by Utah Housing Corporation offer mortgage options tailored to different buyer needs:

• FirstHome: This program is designed for first-time buyers with a credit score of 660 or higher and features Utah Housing’s lowest interest rate. Income and purchase price limits apply, and all household members 18+ are considered in income calculations.
• HomeAgain: This program is available for previous homeowners and first-time buyers who do not qualify for FirstHome. It also requires a 660 credit score and imposes income limits based on household income, but it has no purchase price limit.

The Subordinate Loan program provides down payment and closing cost assistance for homebuyers who qualify for a Utah Housing Corporation first mortgage loan. Offered as a 30-year fixed-rate second mortgage, the Subordinate Loan can cover the borrower’s minimum required down payment and potentially additional closing costs. Utah Housing Corporation Approved Participating Lenders assess the borrower’s needs and help select the best mortgage option while determining how much assistance they qualify for.

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

Utah offers zero-down-payment loan programs that allow you to purchase a home without putting money down. USDA and VA loans are two government-backed options that provide the benefit of no down payment.

USDA loans offer a pathway to homeownership for those in rural areas. They are backed by the U.S. Department of Agriculture and part of the Rural Development Guaranteed Housing Loan program, which assists low- to moderate-income families.

USDA loans provide several advantages, including no down payment and low interest rates. They are specifically tailored for properties in designated rural areas, making them accessible to buyers who might not qualify for traditional loans. Borrowers must meet certain income and property criteria to qualify.

To be eligible for USDA loans, your property must be 2,000 square feet or smaller and located in a USDA-eligible rural area with a population under 35,000. Income limits vary by location. For instance, in Iron County, UT, the limit is $73,300, while in Kane County, UT, it's $76,850 for a four-person, low-income household. These criteria ensure that the loans reach those who need them most, facilitating affordable homeownership in rural communities.

VA loans benefit veterans and service members looking to purchase a home. These loans are issued by the U.S. Department of Veterans Affairs and offer unique financial advantages.

VA loans stand out due to their no-down payment requirement, making homeownership more accessible. Additionally, VA loans do not require private mortgage insurance (PMI), reducing monthly payments. These loans also feature lower interest rates compared to private loans. As of December 2024, the APR for a 15-year fixed-rate VA loan in Utah is 6.06%, while a 30-year fixed-rate VA loan is 6.30%.

To qualify for a VA loan, you must meet specific eligibility requirements. These include your length of service or service commitment, duty status and character of service. You must also meet certain income limits based on your location. A valid Certificate of Eligibility (COE) is necessary to proceed with a VA loan application.

First-time homebuyers in Utah 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 types of mortgages. 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.

As of December 2024, the current APR for a 15-year fixed-rate conforming loan in Utah is 5.86%, while the APR for a 15-year fixed-rate FHA loan is 7.97%. FHA loans can have higher APRs due to the additional fees and costs associated with borrowing on government-backed loans.

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

We've answered frequently asked questions about first-time homebuyer programs in Utah to help you select the best option and move closer to homeownership.

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