First Time Home Buyer Qualifications

If I have a payed off house under my name and its been a few years since I payed it off, could I ever be considered a first time buyer again?

1 Answer

A first time homebuyer is typically considered someone who has not had ownership interest in a home for 3 years or more. Some loan guidelines are longer than that. So in your case as long as you own the property (and for 3 years after selling) you would not qualify to be a first time homebuyer.

Now here's the really good news, there is zero benefit to being a first time homebuyer for you. Any special (local or State) bond programs you would qualify for or community lending programs would be more expensive than tapping equity from your current home to purchase another home. Or using the proceeds from the sale of your home to make the appropriate down payment on your next home.

The real questions here are: What kind of home/property are you thinking of buying?

A) A new home to live in: Well then you could use either strategy listed above (tapping some equity for the new home and then renting the old one maybe?) Or selling...

B.) Vacation home: Here again, if you want to keep the first home outright the cheapest way is to tap enough equity to get the best payment on both properties.

C.) Rental Property: Here again tapping the equity may be the way to go. You can't buy investment/rental property if you are a renter(or a second home) Well- you can but not with a mortgage...

I hope that helps.