Like almost every state in the union, Mississippi offers assistance to first time home buyers in purchasing their first house. But unlike most others, the state doesn't offer assistance to anyone who does not qualify as a first-time buyer. This makes them unusual because most states offer other programs that repeat buyers can take advantage of. This unique situation opens the door to many more opportunities for first time home buyers because they're not competing for state resources with repeat buyers.
All that said the Mississippi Home Corporation was established by a legislative act in 1989 to assure safe and affordable housing for all of Mississippi's residents. They are the state agency responsible for coordinating federal and state resources and administering home buying assistance programs. Although the agency does not lend money directly, they do provide assistance through participating banks and other lending institutions. At the current time they have several different first time home buyer programs available in the state.
Mortgage Revenue Bond
This first program is one that's not seen in many other places in the country. It utilizes the sale of bonds as a means to provide low-interest loans and cash advances to first time buyers who need assistance. The assistance made possible by these bonds includes a 30-year fixed rate mortgage which is FHA insured, cash advances to assist with closing costs and down payment, and the option to access other federal programs such as VA, RD, Fannie Mae and Freddie Mac, and other conventional loans.
To qualify for this program you must be a first time home buyer or someone who has not owned a home within the last three years. You must also meet income eligibility requirements, credit score requirements, and certain county requirements.
Down Payment Assistance Program
The state's down payment assistance program is designed to help low to moderate income first time house buyers cover the cost of their down payments. The assistance can be used for any qualifying first mortgage and constitutes a secondary mortgage at 7%.
The maximum amount of the loan can be no more than 3% of the value of the mortgage and the property cannot cost more than $198,000. If the money is not needed for down payment it can be used toward closing costs. To be approved for this down payment assistance you must meet income eligibility requirements, have acceptable credit, and complete a mandatory home buyer education class.
Habitat Loan Purchase Program
The Habitat Loan Purchase program is another unique Mississippi home buyer program which ties MHC resources to local affiliates of Habitat for Humanity. The program makes low-interest loans available to individuals purchasing Habitat for Humanity homes in targeted areas in the state.
The two main features of these loans are that they can be up to 100% of the property's value and they must be issued by the lender at 0% interest. So that the bank does not lose any money in the deal the MHC takes over the loan after six months of consecutive payments. As with any of the first time home buyers programs in Mississippi, certain restrictions apply. Most notably is a condition which states the new home owner can not have an income higher than 80% of the state's median.
Other State Programs
The MHC has a handful of other state programs targeted at specific groups of individuals. For example, they have a specialized loan program targeting first time home buyers with disabilities. Details on these programs are sketchy which is why we have not expanded on them here. But interested home buyers can visit the MHC website for contact information about these programs.
In addition, the HUD website lists a small number of county and local programs that are currently active. You are urged to contact these individual programs to check for eligibility requirements and the type of assistance they offer.
- Biloxi & Gulfport Gulf Coast Community Action Agency Inc HOME Grant (HG)
- Biloxi PRIDE Homeownership Program (PRIDE)
- Mississippi Down Payment Assistance Program
- Newton First-Time Homebuyer Grant Program (GRANT)