Oklahoma First-Time Homebuyer Assistance Programs

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The Sooner State offers something quite rare in today’s real estate market: relatively affordable housing. Despite median home prices increasing over four percent year-over-year, according to Redfin, prices in the state are still well below the national average. However, “affordable” means something different to everyone. If trying to find the cash to buy a home feels like searching through a dust storm, the Oklahoma Housing Finance Agency (OHFA) offers programs to make buying a first home much easier.

Oklahoma first-time homebuyer programs

OHFA Gold Program

The OHFA Gold loan program offers tax-exempt mortgage revenue bonds for Oklahoma buyers who meet certain income requirements. It’s available for first-time homebuyers (meaning buyers who haven’t owned a home in the past three years) and buyers in some target areas. The Gold program includes both conventional loans and government-backed mortgages.

• Requirements
  

  • Credit score of 640 or higher
  • Maximum purchase price of $349,525 (non-targeted areas) or $427,198 (targeted areas)
  • Must meet income limits (vary by county and household size)
  • Must work with an approved mortgage lender

• Pros and cons
  

  Pros

  • More affordable interest rates
  • Open to first-time and repeat buyers (if you buy in a target area)
  • Reduced interest rates available for teachers, law enforcement, firefighters, emergency medical technicians and state employees

  Cons

  • Limited information online about loan repayment terms

OHFA Dream Program

Like the OHFA Gold program, OHFA Dream is available for first-time and repeat buyers and includes both government and conventional loans. The key difference is that the OHFA Dream program has a higher income limit. You can get an OHFA Dream loan if you already own a home, but you must use the loan to purchase your primary residence.

Additionally, if you don’t need down payment assistance (DPA), you can look into the Dream Zero DPA program, which comes with a lower interest rate.

• Requirements
  

  • Must have a credit score of 640 or higher
  • Must not exceed income limit of $150,000 for government loans but limit varies by county and household size for conventional loans
  • Must not exceed maximum purchase price of $356,362 (government loans) or $453,100 (conventional loans)
  • Must work with an approved mortgage lender

• Pros and cons
  

  Pros

  • More affordable interest rates
  • Open to first-time and repeat buyers
  • Reduced interest rates available for teachers, law enforcement, firefighters, emergency medical technicians and state employees

  Cons

  • Comes with a higher interest rate if you use down payment assistance

Oklahoma down payment assistance and grants

OHFA down payment assistance

In addition to 30-year fixed-rate mortgages, OHFA provides up to 3.5 percent in down payment and closing cost assistance that pairs with the organization’s Gold and Dream loan programs. No fees or interest come with the assistance, but it must be repaid when you pay off your first loan, refinance or sell the home.

• Pros and cons
  

  Pros

  • Nearly 100 participating lenders
  • Can be used for down payment and closing costs
  • Reduced interest rates available for teachers, law enforcement, firefighters, emergency medical technicians and state employees

  Cons

  • Higher rates if you use OHFA’s down payment assistance with its OHFA Dream program
  • Must repay the assistance

REI Home100

REI Oklahoma offers down payment assistance of up to 5 percent of the purchase price. If you’re eligible, you’ll receive the down payment funds in one of three ways: a gift that does not need to be repaid, a forgivable seven-year second mortgage or a second 10-year mortgage with a 5 percent interest rate. You don’t have to be a first-time homebuyer to qualify.

• Requirements
  

  • Have a 640 minimum credit score
  • Have a maximum 45 percent debt-to-income ratio (up to 50 percent with a credit score of 680)
  • Must meet REI Oklahoma income limits, which vary by loan type
  • Must work with an approved mortgage lender

• Pros and cons
  

  Pros

  • Multiple types of assistance programs available
  • Some assistance programs don’t require repayment (gift and forgivable second mortgage)
  • Nearly 50 approved lenders
  • Open to first-time and repeat homebuyers

  Cons

  • Borrower must contribute at least 3 percent of their own funds when buying a two-unit property with a conventional loan
  • The amortizing second mortgage assistance type comes with required monthly repayments

City specific homebuyer assistance programs

Besides statewide assistance, some cities and counties offer assistance programs as well. Be sure to research the area in which you want to buy for any local programs you might qualify for. Below are some examples.

Stillwater Homebuyers Assistance Program

First-time buyers and low- and moderate-income buyers purchasing properties in the city of Stillwater can qualify for up to $5,000 of down payment and closing cost assistance. The money is forgiven after living in the home for seven years.

• Requirements
  

  • For low- and moderate-income buyers, household income cannot exceed 80 percent of the area median income
  • For first-time buyers, maximum purchase price cannot exceed $250,000
  • Must live in the home as your primary residence for at least seven years
  • Must complete a homebuyer education class
  • Must purchase within Stillwater city limits

• Pros and cons
  

  Pros

  • Doesn’t require repayment (if you live in the home for at least seven years)
  • Includes single-family houses, condominiums, townhouses and manufactured homes that meet certain criteria
  • Open to first-time and repeat buyers
  • No income limits for first-time buyers

  Cons

  • Repayment required if you move out, sell or refinance within the first seven years after closing

Oklahoma City Homebuyers Assistance Program

Funded by the U.S. Department of Housing and Urban Development, HOME Investment Partnerships Program (HOME) provides up to $18,000 in down payment and closing costs assistance. You can also get an extra $5,000 to buy down your interest rate. The program is available to first-time and repeat buyers who purchase a home in an approved area.

• Requirements
  

  • Must not exceed income limits, which vary by household size
  • Purchase price cannot exceed 95 percent of median home sale price in Oklahoma City
  • Have a maximum 43 percent debt-to-income ratio
  • Must contribute at least 1 percent of the home’s sale price toward the purchase
  • Must complete a homebuyer education class

• Pros and cons
  

  Pros

  • Open to first-time and repeat buyers
  • Can be used for down payment and closing costs
  • Extra $5,000 to buy down interest rate available

  Cons

  • You must put at least 1 percent of your own money toward the home purchase (1.75 percent for FHA loans)

Midwest City Homebuyers Assistance Program

If you’re a first-time homebuyer in Midwest City, you may be eligible for this program, which offers up to $7,500 for the down payment and closing costs. After five years, the loan will be forgiven — provided that you keep the home as your primary residence until that point.

• Requirements
  

  • Must be a first-time homebuyer
  • Must purchase a property in Midwest City
  • Household income cannot exceed 80 percent of the area median family income
  • Must complete a homebuyer education course
  • Must contribute at least 1.5 percent of the sales price (minimum of $500) of your own funds to the down payment and closing costs

• Pros and cons
  

  Pros

  • Forgiven after five years in the home as a primary residence
  • Can be used for down payment and closing costs

  Cons

  • Repayment required if the home is no longer your primary residence in the first five years after closing
  • You must put at least 1.5 percent of your own funds toward the purchase

Tulsa County First Home Program

In Tulsa County, the newly-created First Home Program provides borrowers with a 30-year fixed-rate mortgage and a forgivable loan to put toward a down payment and closing costs. The assistance is equal to 3.5 percent of the home’s sale price (for a maximum of $17,882). It’s targeted toward first-time buyers, but it’s also open to repeat buyers in target areas and veterans.

• Requirements
  

  • Credit score of 620 or higher
  • Maximum purchase price of $510,939 (non-targeted areas) or $624,481 (targeted areas)
  • Must meet income limits (vary by area and household size)
  • Must complete a homebuyer education class

• Pros and cons
  

  Pros

  • Zero interest deferred second mortgage, forgivable after five years
  • Can be used for down payment and closing costs
  • Multiple property types accepted (single-family homes, townhomes, condos)

  Cons

  • Repayment required if the home is no longer your primary residence or you refinance in the first five years after closing
  • Only open to repeat buyers in targeted areas

Other Oklahoma first-time homebuyer loans

There are nationally-available loans that can make a big difference in your ability to buy a home in Oklahoma including:

• FHA loans: With just a 3.5 percent down payment and a credit score of 580, you may be able to qualify for an FHA loan. And if your credit score is even lower (falls between 500 and 579), you may still be able to get a loan, but you will need a down payment of 10 percent.
• VA loans: Current service members, veterans and eligible spouses can qualify for a VA loan, which does not require a minimum down payment. There’s no minimum credit score, either, but lenders do set their own borrower standards.
• USDA loans: If you’re buying in a qualifying rural area, loans backed by the United States Department of Agriculture can be a great fit for your homebuying needs. You won’t need to make a down payment on the home. Use this tool to determine if the area you want to buy is classified as “rural.”

Get started

When you’re ready to begin the home loan process, a participating Oklahoma Housing Finance Agency (OHFA) mortgage lender can help you determine your options. While OHFA doesn’t provide mortgages directly, the agency works with over 80 lending institutions across the state.

You can also prepare for homeownership in Oklahoma by:

• Explore other first-time homebuyer programs by state