If you have owned a house before, you may still qualify as a first-time homebuyer. Here are the requirements:
Three years of non-homeownership
Fannie Mae, one of the big three government-backed mortgage investors (and mortgage standard-setters), defines first-time homebuyer as a mortgage loan applicant who fits all of the following three descriptions:
(1) purchasing the security property,
(2) residing in the security property as a principal residence, and
(3) had no ownership interest (sole or joint) in a residential property during the three-year period preceding the date of the purchase of the security property.
If your current home isn’t really “yours”
Fannie Mae adds that an individual who is a displaced homemaker or single parent may be considered a first-time home buyer if he or she had no ownership interest in a principal residence (other than a joint ownership interest with a spouse) during the preceding three-year time period.
You’ve fulfilled the waiting period after short-sale or foreclosure
For anyone who has been through a short sale or foreclosure, you may qualify as a first-time homebuyer if you have fulfilled the waiting period required by the mortgage lender.
Sometimes it’s the typical three-year period and sometimes it’s longer – anywhere from 4-7 years is common. This time frame depends on what the lender has decided according to the guidelines of government entities backing the loan such as the Federal Housing Administration, Fannie Mae or Freddie Mac.
About those first-time homebuyer perks
As a first-time homebuyer, you may have access to loan programs only offered to first-time buyers that have special no or low down payment options, programs that include down payment assistance or that offer more flexibility when it comes to closing costs. Plus, there may be potential tax breaks the year following your home purchase (Check with a Tax Professional) if you fit into this homeownership group.
To learn more about qualifying as a first-time homebuyer, what benefits are available and if this could give you a home buying advantage, contact a mortgage professional.