North Carolina First-Time Home Buyer | Programs & Grants

What to know about buying a house in North Carolina

Buying your first home can be complicated no matter where you’re purchasing. But the good news is that as a North Carolina first-time home buyer, you don’t have to do it alone.

In fact, you have plenty of advice and educational support readily available. And, The Old North State is home to various programs that might provide financial help with your down payment and (sometimes) closing costs.

Here’s how to get started.

In this article (Skip to...)

• NC home buyer programs
• First-time buyer grants
• NC home buyer key stats
• Home loan options
• Buying in North Carolina’s cities
• Resources
• NC mortgage rates

North Carolina first-time home buyer programs

The North Carolina Housing Finance Agency (NCHFA) encourages first-time home buyers in the state to use a housing counselor approved by the US Department of Housing and Urban Development (HUD). Its website stresses that “Many mortgage programs require their buyers to obtain pre-purchase counseling from a HUD-approved housing counselor.”

Yes, there’s a modest cost to this home buyer education. But the advantages of having an independent expert hold your hand through the process can be considerable. To help you get started, check out our resource section below and download NCHFA’s free Pocket Guide to Home Ownership.

NC Home Advantage Mortgage

The NC Home Advantage Mortgage program offers both North Carolina first-time home buyers and “move-up” buyers a 30-year fixed-rate mortgage. The agency considers those who haven’t owned a home in the past three years to be a first-time buyer and anyone who already owns to be a “move-up” buyer.

Regardless, qualifying buyers can choose between a conventional, FHA, VA, or USDA loan through the program’s participating lenders. Depending on the loan type, buyers can purchase a single-family home, duplex, townhouse, or a new manufactured home.

The NC Home Advantage Mortgage also comes with optional down payment assistance of up to 3% of the loan amount. What’s more, North Carolina first-time home buyers can also stack additional NCHFA home buying assistance on top of this help. More on this in the next section.

NCHFA home buying assistance program requirements

While home buyer education is required in some cases, first-time buyers should always adhere to these guidelines.

• Minimum credit score of 640 required
• Buyer income and purchase price must be within program limits
• Debt-to-income ratio must be less than 43%

Lastly, be mindful that you’ll also need to meet any sales price limits established by your chosen loan type.

North Carolina first-time home buyer grants

The North Carolina Housing Finance Agency also provides generous down payment assistance loans to eligible first-time buyers across the state.

NC 1st Home Advantage Down Payment

NC 1st Home Advantage Down Payment is available to first-time home buyers or military veterans who are purchasing in a targeted census tract. Unlike the Home Advantage Mortgage, move-up buyers are not eligible for this program.

But for those who qualify, this NCHFA down payment assistance program can provide up to $8,000 toward your home purchase. Assistance comes in the form of a zero-interest deferred second mortgage that is completely forgiven after you’ve owned and lived in the home for 15 years.

• If you sell, refinance, or move within the first 10 years, you’ll have to repay the full loan amount
• 20% of the loan amount is forgiven at the end of each year in years 11 through 15
• After that, your down payment assistance mortgage will be fully paid off

To be eligible for its home buyer assistance program, you must not exceed household income limits. You’ll also need a credit score of 640 or higher. There are other conditions too, which you’ll find on the NCHFA website.

NC Home Advantage Tax Credit

With the NC Home Advantage Tax Credit, first-time buyers get a Mortgage Credit Certificate (MCC) that could save you up to $2,000 each year on your federal taxes. But MCCs are only available with an NC Home Advantage Mortgage, not an NC 1st Home Advantage Down Payment.

North Carolina first-time home buyer key stats

The median home price in North Carolina was $377,500 in September 2024. That rose 3% over the same time a year ago, according to Redfin.

Even though housing prices are more affordable in North Carolina than nationwide, becoming a homeowner can still be a challenge. Fortunately, North Carolina first-time home buyers have access to plenty of assistance in the form of education, special mortgages, and down payment assistance.

North Carolina home buyer stats

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 North Carolina

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

Of course, few first-time buyers have saved enough for 20% down. But the good news is that 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 the low-down-payment loan programs listed below.

Low-down-payment mortgage programs

• Conventional 97: From Freddie Mac or Fannie Mae. 3% down payment and 620 minimum credit score. You can usually stop paying mortgage insurance after a few years
• 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, sell your home, or pay off your loan
• VA loan: Only for military veterans and active-duty service members. A zero down payment is required. The minimum credit score varies by lender but is 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. A zero down payment is required. Credit score requirements vary by lender but often 640. Low mortgage insurance rates
• North Carolina Housing Finance Agency: May include competitive interest rates and down payment assistance. More information below

Note that government loan programs (including 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.

In addition, most programs let you use gifted money or down payment assistance (DPA) to cover your down payment and closing costs. Depending on your mortgage loan, you could potentially get into a new house with minimal cash out of pocket.

If you’re unsure which program to choose for your first mortgage, your lender or real estate agent can help you find the right match based on your finances and home buying goals.

Buying a home in North Carolina’s major cities

As is often the case, home prices are high in big, prosperous cities. That’s certainly true for Charlotte and Raleigh. But Greensboro prices tend to be lower than the state average, but they’re rising quickly.

Charlotte first-time home buyers

The median purchase price for homes in Charlotte was $430,000 in September 2024. That grew 1.2% 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:

• $12,900 for 3% down payment
• $86,000 for 20% down payment

If you’re a first-time buyer wanting a single-family home in Charlotte, check out the House Charlotte Program. That’s a City of Charlotte initiative, administered by a private-sector company.

It has several different programs for people with low and median incomes. When this was written, the most you could receive is $50,000 in assistance, which will be forgiven after 30 years. All House Charlotte programs take the form of zero-interest deferred second mortgages with no monthly payments.

Check out our resource section below for a link to the program’s website where you can find additional eligibility information.

Raleigh first-time home buyers

The median sales price of homes in Raleigh was $499,900 in September 2024. That increased 2.2% 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:

• $14,997 for 3% down payment
• $99,980 for 20% down payment

The City of Raleigh requires you to attend a homeownership class and get a certificate before you can enter its down payment assistance program. Once you have that, the city offers two options: the traditional Homebuyer Assistance Program and the new Enhanced Homebuyer Assistance Program.

The Homebuyer Assistance Program is a deferred second mortgage of up to $30,000. The Enhanced Homebuyer Assistance Program goes up to $60,000. Both can be applied to help with down payment and closing costs or a gap in financing.

Keep in mind that the maximum sale price limit is for the Homebuyer Assistance Program is $370,000 for a single-family home while the Enhanced Homebuyer Assistance Program caps out at $450,000. So if the home you’re interested in costs more than that, then one of the statewide NCHFA programs may be better suited for you.

Furthermore, the website doesn’t provide details about the loan’s forgiveness schedule. So reach out to 919-996-4330 for more information.

Greensboro first-time home buyers

The median list price of homes in Greensboro was $325,000 in September 2024. That rose 7.7% 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:

• $9,750 for 3% down payment
• $65,000 for 20% down payment

The City of Greensboro’s Housing Connect Homebuyer Assistance Program can provide up to $15,000 to eligible first-time buyers.

This takes the form of a zero-interest deferred second mortgage, forgiven after 10 years of your retaining ownership of the home and remaining in residence. And you can borrow on the same terms up to $20,000 in total down payment assistance if you buy in one of the city’s redevelopment areas.

Various eligibility and conditions apply and you can find them on the website. But these are less strict than many others, especially when it comes to income limits.

Where to find home buying help in North Carolina

All the organizations we’ve listed above should provide advice freely to any North Carolina first-time home buyer. Your real estate agent and loan officer can also help locate down payment assistance and choose a loan program.

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 which you can view below.

State and regional first-time home buyer programs in NC

• HUD’s Homeownership Assistance Programs
• North Carolina Housing Finance Agency (NCFA)
• NCHFA’s Pocket Guide to Home Ownership (available in English and Spanish)
• NC Home Advantage Mortgage
• NC Home Advantage Tax Credit
• NC 1st Home Advantage Down Payment
• Greensboro Housing Coalition
• Financial Pathways of the Piedmont
• Downtown Housing Improvement Corporation (DHIC) in Raleigh
• Durham Affordable Housing Coalition

NC home buying programs by city and county

• House Charlotte Program
• The City of Raleigh Down Payment Assistance Program
• The City of Greensboro Housing Connect Homebuyer Assistance Program

Local North Carolina first-time home buyer programs

Greensboro, NC
The Greensboro Housing Coalition
(336) 691-9521

Rocky Mount, NC
South Eastern North Carolina Community Development Corporation
1006 Aycock Street
Rocky Mount, NC 27803
Contact: Larry Russell
(252) 977-3141

What are today’s mortgage rates in North Carolina?

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

When you’re ready to start the home buying process, experiment with a mortgage calculator to see how down payment and interest rates will affect your mortgage payment. Then, get personalized rate quotes from at least three to five mortgage lenders.

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

¹Source: Redfin North Carolina Housing Market report

²Source: Experian.com FICO Score data as of 2021

³Based on a review of the state's available DPA grants at the time this was written