Current Missouri mortgage rates

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Mortgages in Missouri

If you’re a resident of Missouri with a low- to moderate-income, you can access help from the Missouri Housing Development Commission (MHDC) to achieve affordable housing.

MHDC works with a list of approved lenders to run its homebuyer programs.

Some of those programs have different requirements if you’re buying in a targeted area of Missouri.

More: Get a free credit score and credit monitoring from Credit Sesame.

First Place Loan Program

The First Place Loan Program offers below-market interest rates on mortgages for first-time homebuyers and qualified veterans.

MHDC defines a first-time buyer as someone who has not owned or had a principal interest in a home in the last three years. Qualified veterans include any veterans who have served on active duty, though they must apply for financing within 25 years of the date they left active duty.

The commission sets the interest rates for all of its lenders, as well as how much they can charge you on closing costs, meaning everyone has access to the same rates. You can find the MHDC’s purchase price and income limits on its website.

Since this program doesn’t offer help on down payment and closing costs, it’s best suited for individuals who can afford those costs on their own.

The income limits for this program vary by region.

The purchase price limit depends on the type of home and whether it’s located in a targeted area of the state. In non-targeted areas, you can obtain a maximum of $294,600 for a single-unit property and $377,219 for a two-unit property. In targeted areas, that goes up to $360,067 for single units and $461,046 for two units.

Candidates will also have to meet the credit score requirements and make the home their primary residence within 60 days of closing.

First Place with Cash Assistance Loan (CAL) Program

In addition to the primary First Place loan, this program grants qualified homebuyers a second, forgivable loan of up to 4% of the purchase price of their home to help with their down payment and closing costs.

The loan works as a second mortgage on a 30-year fixed-rate term, but it will be forgiven after 10 years, provided you keep the property as your primary residence. It can be applied with conventional, FHA, VA and USDA mortgages.

Next Step Loan Program

The Next Step program helps repeat buyers who can’t afford to make a down payment on a new home as well as first-time buyers who fall outside the income limits for the First Place program.

Working with a qualified lender, Missouri homebuyers can qualify for a 30-year fixed-rate mortgage at a competitive rate. It’s compatible with conventional, FHA, VA and USDA loans, and you’ll have the option of applying for upfront cash assistance and a mortgage credit certificate.

The income limits for this program vary by region across Missouri. Applicants will also have to meet the credit score requirements and make the home their primary residence within 60 days of closing.

Next Step Cash Assistance Loan Program

The Next Step CAL program offers qualified homebuyers a cash assistance loan of 4% of the purchase price of their home to help with their down payment and closing costs.

Like the First Place CAL, this will be a second mortgage on a 30-year fixed-rate term. After 10 years, provided you keep the property as your primary residence, the loan will be forgiven. It can be used with conventional, FHA, VA and USDA first loans.

First-time homebuyers may also combine Next Step with MHDC’s Mortgage Credit Certificate program, provided they meet the requirements.

Mortgage Credit Certificate (MCC)

An MCC offers you a dollar-for-dollar credit on your federal taxes for the interest you pay on your mortgage loan. It can only be issued through MHDC’s participating lenders and is typically only available to low- to moderate-income borrowers.

On its own, the MCC is worth 25% off your annual mortgage interest, but you can combine it with the Next Step CAL Program to bring that up to 35% or the Next Step without CAL to qualify for 45%. The maximum allowable credit each year totals $2,000, but you can carry forward any unused portion of the credit for up to three years.

This program is reserved for first-time homebuyers, and you’ll have to apply for it through one of MHDC’s participating lenders. To qualify, you’ll have to fall under certain income and purchase price limits and meet MHDC’s credit score requirements.

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