June 14, 2024


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Idaho First-Time Home Buyer | 2022 Programs and Grants

What to know about buying a house in Idaho

Home prices in Idaho are high, and climbing faster than the national average.

But that shouldn’t put you off as a first–time homebuyer. There are plenty of resources available to help you toward your goals; from special mortgages with low rates, to homebuyer education courses and down payment assistance.

Ready to get started? Here’s what to do.

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Idaho home buyer overview

In December 2021, the median listing price in Idaho was $614,450 according to Redfin. And home prices statewide were up 26.3% year–over–year.

Unfortunately, the Gem State doesn’t offer statewide home buyer assistance programs, unlike most other states.

But the private sector does offer some help. And there are plenty of accommodating mortgage programs that can make your home purchase more affordable.

Idaho home buyer stats

Average Home Sale Price in ID $614,450
Minimum Down Payment in ID (3%) $18,433
20% Down Payment in ID $122,890
Average Credit Score in ID1 720
Maximum ID Home Buyer Grant2 Idaho Housing forgivable loan of up to 5% of the sale price

Down payment amounts are based on the state’s most recently available average home sale price. “Minimum” down payment assumes 3% down on a conventional mortgage with a minimum credit score of 620.

If you’re eligible for a VA loan (backed by the Department of Veterans Affairs) or a USDA loan (backed by the US Department of Agriculture), you may not need any down payment at all.

First–time home buyer loans in Idaho

If you’re a first–time home buyer in Idaho with a 20% down payment, you can get a conventional loan with a low interest rate. And you never have to pay for private mortgage insurance (PMI).

Of course, few first–time buyers have saved enough for 20 percent down. But the good news is, you don’t need that much. Not by a long shot.

Borrowers can often get into a new home with as little as 3% or even 0% down using one of these low–down–payment mortgage programs:

  • Conventional 97 – From Freddie Mac or Fannie Mae. 3% down payment and 620 minimum FICO score. You can usually stop paying mortgage insurance after a few years once you reach 20% home equity
  • FHA loan – Backed by the Federal Housing Administration. 3.5% down and a 580 minimum credit score. But you’re on the hook for mortgage insurance until you refinance to a different type of mortgage, move, or pay off your loan
  • VA loan – Only for veterans and service members. Zero down payment is required. Minimum credit score varies by lender but often 620. No ongoing mortgage insurance after closing. These are arguably the best mortgages available, so apply if you’re eligible
  • USDA loan – For those on low–to–moderate incomes buying in designated rural areas. Zero down payment required. Credit score requirements vary by lender but often start at 640. Low mortgage insurance rates
  • Idaho Housing loans – May include competitive interest rates and down payment assistance. More information below

Note that government loan programs (including the FHA, VA, and USDA home loans) require you to buy a primary residence. That means you can’t use these loans for a vacation home or investment property.

Depending on the mortgage loan you choose, you could potentially get into your new house with minimal cash out of pocket.

These programs even let you use gifted money or down payment assistance (DPA) to cover the down payment and closing costs.

If you’re not sure which program to choose for your first mortgage loan, your lender can help you find the right match based on your finances and home buying goals.

Idaho first–time home buyer programs

Unusually, Idaho’s state government doesn’t offer or facilitate mortgage loans itself.

The closest alternative is the Idaho Housing and Finance Association (Idaho Housing). That’s “a self–supporting organization that sustains its business operations through earned fees and revenues similar to any private financial institution.”

Idaho Housing offers a range of mortgage types, including conventional loans along with FHA, USDA, and VA loans. And it says it offers the “lowest financing rates in Idaho.”

Other advantages include:

  1. Only 3% down payment on conventional loans
  2. A down payment assistance program
  3. Mortgage credit certificates (allow you to deduct up to $2,000 in mortgage interest each year from your federal taxes)
  4. Home buyer education courses, backed up with continuing support for the duration of your loan

You must meet income limits to be eligible for the Idaho Housing program, which were capped at $125,000 in January 2022. But the website doesn’t say whether that’s total household income or only the borrower’s income.

These sorts of programs usually come with other qualifying criteria, such as minimum credit scores and maximum home prices. There is an eligibility checker that you can complete to see whether you qualify.

Idaho first–time home buyer grants

Idaho Housing doesn’t offer grants. Instead, it has two programs that let you borrow money toward your down payment in the form of a second mortgage.

The first option is a standard loan that can be big enough to cover almost all your down payment and closing cost requirements. It comes with a 5% interest rate and is repayable in equal monthly installments over 10 years. Unless you’re eligible for a Heroes mortgage, you’ll need a credit score of 680 or better. And you’ll have to contribute at least 0.5% of the sales price from your own resources. Again, there’s an income cap of $125,000.

The second is a forgivable loan. In most ways, this is better. Because it has a 0% interest rate and no monthly payments. But you can only borrow up to 5% of the sale price.

Each year, 10% of the loan is forgiven. So by the end of year 10, you’ll owe nothing. But if you move, sell or refinance during those 10 years, you’ll have to immediately repay the proportion that hasn’t been forgiven.

In addition, the forgivable loan doesn’t come for free. The website says, “For each 0.5% of forgivable loan used, 0.125% will be added to the interest rate of the first mortgage.”

If you want to know more about either of these down payment assistance programs, visit this webpage.

Buying a home in Idaho’s major cities

Buying your first home in one of Idaho’s three biggest cities may be cheaper than buying in the state as a whole. That’s because home prices in Boise, Meridian, and Nampa are actually a little lower than the statewide average. And, in 2021, only Meridian saw those prices rise more quickly than average.

Many (maybe most) cities across America help out first–time home buyers with down payment assistance programs. But, unusually, none of those three biggest cities in Idaho had such a program when we checked.

Still, you can always fall back on Idaho Housing (above), if you’re eligible and need help. You can also ask your real estate agent or loan officer about alternative down payment assistance programs run by local nonprofits and other groups.

Boise City first–time home buyers

In December 2021, the median list price of homes in Boise was $538,800. That was an increase of 19.8% year–over–year according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

  • $16,160 for 3% down payment
  • $107,760 for 20% down payment

When we checked the City of Boise website said, “The City of Boise is not currently accepting applications for down payment assistance.” You could check back to see if that policy has changed by the time you read this.

In the meantime, it refers you to “partner organizations,” NeighborWorks Boise and Autumn Gold. The site also directs readers to Idaho Housing, above.

Meridian first–time home buyers

In December 2021, the median list price of homes in Meridian was $599,000. That was an increase of 33.7% year–over–year according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

  • $17,970 for 3% down payment
  • $119,800 for 20% down payment

Neither the City of Meridian nor Ada county appears to have down payment assistance programs. Private company Supreme Lending’s Meridian team does suggest a program that includes a forgivable loan, though it works only with FHA mortgages.

Nampa first–time home buyers

In December 2021, the median list price of homes in Nampa was $450,000. That was an increase of 15% year–over–year according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

  • $13,500 for 3% down payment
  • $90,000 for 20% down payment

We could find no trace of a down payment assistance program on the City of Nampa’s website, nor that of Canyon County. However, you should ask your agent or loan officer about DPA from local nonprofits and other organizations if you’re looking for assistance,

Where to find home buying help in Idaho

All the organizations we’ve listed above should provide advice freely to any first–time home buyer in the state of Idaho or within their areas.

In addition to our selection, the U.S. Department of Housing and Urban Development (HUD) provides a few lists for statewide, regional, and local resources:

Idaho first-time home buyer programs by area

What are today’s mortgage rates in Idaho?

You can see today’s live mortgage rates in Idaho here.

When you’re ready to start the home buying process, make sure you get personalized rate quotes from at least three mortgage lenders.

Don’t just look at advertised rates online; actually apply for preapproval and compare the interest rates and fees you’re offered. That’s the only way to know you’re getting the best deal possible on your new home loan.

1 Source: Experian.com 2021 study of 2020 data

2Based on a review of the state’s available DPA grants at the time this was written

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.