If you live in South Carolina and are looking to buy your first home, we have some good news. The state has a handful of first time home buyer programs to help eligible buyers achieve their dreams of homeownership. They don't have as many programs as some other states, but they have at least a couple that might be beneficial. Their programs are divided into two categories: targeted areas and non-targeted areas. Loans and assistance programs are identical under both categories except for the fact that in the targeted areas buyers need not be first time home buyers as long as they meet all other eligibility requirements.
Keep in mind that targeted and non-targeted areas may change as economic conditions in the state change. Your real estate broker will know whether or not you are currently in a targeted area. If not, and you're a first time home buyer, it won't make much difference anyway. The designation is only of concern to those who are repeat buyers. Also keep in mind that the state's loans and down payment assistance programs are all made available through participating mortgage lenders and local banks. The state itself does not make or service the loans.
South Carolina State Housing Finance & Development Authority
Most states have a designated state agency responsible for affordable housing. That agency is the one that administers federal funds, state grants, and other sources of financial home assistance. In South Carolina that agency is known as the South Carolina State Housing Finance & Development Authority (SCSFHDA). The agency currently administers only three programs: a low-cost loan, a down payment assistance program, and a special program aimed at first time buyers who are also veterans or first responder personnel. Details of all three programs can be found on the agency's website.
Low Interest Mortgage Loan
South Carolina offers a low interest loan for income eligible individuals. It is typically a point or so lower than the current going rate for traditional mortgages. There are specific income eligibility requirements for all applicants and additional requirements based upon where they fall in the income threshold. Applicants with incomes less than 80% of the mean have requirements a bit more stringent than those whose incomes exceed 80% of the mean. Special requirements that are less stringent apply to single parents.
To see if you qualify for one of these loans you will be required to fill out an application with a participating lender. You'll also need to have a specific property in mind that you want to purchase; in some cases you may even need a signed purchase agreement. These requirements vary so you'll need to check with your mortgage lender when you're ready to apply for your loan.
Down Payment Assistance
South Carolina also offers down payment assistance for qualified first time buyers. How this assistance is structured depends on eligibility requirements. For those whose incomes are less than 80% of the mean the assistance is in the form of a no-interest, forgivable loan of up to $4000. In order for the loan to remain forgivable homeowners must stay current on their mortgage payments and remain in the home as their primary residence for a specified amount of time.
For first time home buyers whose income exceeds 80% of the mean are also provided up to $4000 for down payment assistance. However, their loans must be repaid according to a schedule specified by the state agency. Under this schedule the first payment must be made along with the second mortgage payment the homeowner makes. From that point forward the home buyer has three years to pay off the loan in full as he sees fit. The final payment will be due on the third anniversary of the second mortgage payment. During the three-year term there will be no interest accrued.
Palmetto Heroes Program
The state of South Carolina recently announced a brand-new program aimed at police officers, firefighters, EMS personnel, other first responders, and teachers. Under this program eligible applicants will receive low interest mortgages for qualified properties. They will also be eligible to receive down payment assistance of up to $5000. The state has not yet released the details of this program so we're unable to say much more about it. If you believe you are a qualified applicant you should contact a real estate broker or your money institution for details.
Other South Carolina Programs
As in most states, there are a handful of local programs offered throughout the state. HUD keeps track of these opportunities and publishes them on their own website from time to time. We have included below the list that is currently available from HUD. Be aware that local programs often have additional requirements such as residency, renovation, and geographic location.
Always be sure that you know exactly what a local program requires of you before you sign any paperwork. There has been more than one occasion where an individual was unsure of what the requirements were only to regret his decision later on.
- Richmond County United Black Fund of the Midlands/Columbia Housing Authority Homeownership Program (HOP)
- Rock Hill Joint Venture Affordable Housing Corporation First Time Homebuyers Down Payment & Closing Cost Assistance Program
- Spartanburg County Home-Ownership Program (HOP)