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South Carolina First-Time Homebuyer Programs

Buying a home has long been an embodiment of the American dream. But the process involves much more than finding your dream abode and making a down payment — potential buyers can quickly find themselves struggling to navigate a whirlwind of credit checks, differing loan terms, program titles and paperwork.

It doesn’t have to feel so overwhelming if you’re prepared. In addition to federal programs, the state of South Carolina offers opportunities to help residents find the financing and education they need to make their first home purchase possible.

South Carolina first-time homebuyer programs

SC Housing, short for the South Carolina State Housing Finance & Development Authority, offers a variety of programs to help state residents become homeowners. From competitive, fixed-rate home loans and tax credits to assistance for down payments and closing costs, SC Housing helps potential homebuyers in South Carolina achieve their dream of homeownership through a range of options that make purchasing and owning a home more affordable.  ​​​​

In January 2019, we researched the most current information on first-time homebuyer programs in South Carolina, which included reviewing program websites and guidelines from SC Housing. Here’s what first-time homebuyers in South Carolina need to know.

Eligibility for South Carolina assistance

  • Must be a first-time homebuyer or have not had ownership interest in a principal residence in the past three years for non-targeted counties
  • Cannot currently own a home or have any ownership interest in a home at the time of closing for targeted counties (federally designated areas of economic distress; view a list of targeted and non-targeted counties here)
  • 620-640 minimum credit score

Meeting the above eligibility guidelines does not guarantee approval for a home loan. To start the application process, potential homeowners can contact an SC Housing lending partner in the county where they wish to buy a home.

You can check current mortgage rates for your state here.

SC Housing Homebuyer Program

Features

  • Low, fixed-rate, 30-year mortgages
  • Down payment assistance available based on income and home price limits; limits are higher if home is located in targeted area
  • FHA maximum loan-to-value mortgage of 96.5% with 3.5% down payment for 620 minimum credit score
  • 97% loan-to-value conventional mortgage with 3% down payment and reduced mortgage insurance requirements for 640 minimum credit score
  • 95% maximum loan-to-value conventional mortgage with 5% down payment and reduced mortgage insurance requirements for 640 minimum credit score
  • 100% loan-to-value USDA RHS loan with 640 minimum credit score
  • 1% origination fee, prepaid items and other customary closing costs
  • $6,000 in down payment assistance available as a repayable or forgivable second mortgage loan depending on income
  • To qualify for down payment assistance, potential buyers must complete a homeownership course

Eligibility

  • Standard SC Housing eligibility applies
  • Household income and home price limits must be under required levels for down payment assistance

How it works

You can apply for a loan through the SC Housing Homebuyer Program by contacting a partner bank, credit union or mortgage broker. You can also send questions to [email protected] or call 803-896-2211 for more information on first-time homebuyer programs.

SC Housing mortgage tax credit

Features

  • Eligible buyers receive a mortgage credit certificate, which allows a federal tax credit of a portion of annual interest up to $2,000 per year
  • Credit can be taken each year the buyer lives in the home
  • No minimum credit score

Eligibility

  • Standard SC Housing eligibility applies
  • 30-year mortgage
  • Eligible properties must be single-family, owner-occupied primary residences
  • Land values cannot exceed 30% of the total appraised value
  • Loans cannot be used in conjunction with a SC Housing bond loan, a qualified Veterans bond loan, a FHA 203(K) loan or with a USDA Direct loan

How it works

South Carolina residents can contact an authorized lender for more details. You can also send questions to [email protected] or call 803-896-2211 for more information.

Palmetto Home Advantage

Features

  • Offers a Fannie Mae conventional mortgage with 3% or 5% forgivable down payment assistance
  • Reduced mortgage insurance coverage (18% vs. 25%)
  • New and existing homes are eligible
  • Mortgage insurance may be canceled for borrowers with credit scores over 640

Eligibility

  • Standard SC Housing eligibility applies
  • Income of $87,500 or less
  • Available to first-time and repeat homebuyers

How it works

South Carolina residents can contact an authorized lender for more information and prequalification options. You can also send questions to [email protected] or call 803-896-2211 for more information.

Hardest Hit Fund down payment assistance

Features

  • FHA mortgage loan for specific zip codes in Richland, Lexington and Sumter counties
  • $15,000 down payment assistance; can be completely forgiven if buyer remains in the home for at least 10 years
  • First-come, first-served funding; this program started Oct. 15, 2018

Eligibility

How it works

Residents should contact an SC-Housing-approved lending partner, call 803-896-2211 or email [email protected] for more information. Visit the program website for a list of eligible zip codes.

National first-time homebuyer programs

Nationwide programs are available to assist first-time homebuyers looking to finance a home purchase. If you are buying in a rural area, the USDA offers a guaranteed loan program through its rural development unit for single-family housing in South Carolina. To learn more about national programs available to first-time homebuyers, check out LendingTree’s comprehensive list of resources.

 

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