Police officers, firefighters, EMTs, and teachers give so much to our country. They selflessly put their lives on the line to protect us, take care of our children, and help us accomplish our dreams. So it’s only right that they have the same opportunity to achieve their own American dream of buying a home.
Unfortunately, even though these public servants are working tirelessly in essential roles, they often have a difficult time purchasing property. Too often, it’s just out of reach financially.
The good news is that thanks to a range of public and governmental programs, these public servants have more opportunities than ever to buy a house at affordable rates and through a simplified process. There are options for tax breaks, down payment help, subsidized mortgage interest, and reduced closing costs. It’s all about making homes for heroes a realistic venture. Let’s talk about what’s available!
Mortgage Loan Assistance
There are many different private home loans for teachers, health care professionals, and rescue workers, and law enforcement personnel. These loans typically offer the lowest mortgage rates possible—though it’s still important to shop lenders to find the best deal.
One such program is Freddie Mac’s Home Possible Program, which offers first responder home loans that finance up to 100% of the purchase price. There are also similar programs offered through Fannie Mae and many other private banks. We recommend checking with lenders in your area.
You should also check with your state and/or city to see if there are similar programs.
New Jersey offers first responders a discounted mortgage rate that can be up to a full percentage point less than the market rate.
Alaska has a program for health care and school workers that finances 100% of a home’s purchase price and includes subsidized interest rates.
Beyond lower interest rates and financing 100% of your home, the IRS offers Mortgage Credit Certificates (MCCs) to help make homes for heroes easier to purchase. This credit differs from state to state but can enable teachers, police, firefighters, and EMTs to buy a more expensive house with the same income.
How does it work?
An MCC allows you to deduct your mortgage interest and gives you credit against tax liabilities. This means that your lender will subtract the credit from your house payment when calculating your debt-to-income ratio so that you can get a larger loan.