With the FNMA program, you need to save only 3 percent, or $3000 on a $100,000 sales price. The rest of the money you need for closing can come from a gift from relatives or a nonprofit organization or some sort of state or local government program in the form of a grant. The program is designed for low- to moderate-income families. It allows you to purchase more home because the qualifying ratios are eased. This lower down payment conventional loan can compete with the most popular first-time homebuyer loan.

On the other end, this program has a component designed to protect the lender. The Federal Housing Administration (FHA), a division of the Department of Housing and Urban Development (HUD), is tasked to insure residential real estate loans made by lenders. It sets standards for construction and underwriting. The FHA neither lends money nor plans or constructs houses.

The CHBP has one catch, however. You must take a special educational course on preparing for home ownership, covering such topics as analyzing your current expenses and negotiating your contract. You will learn what to expect from the loan company. It will be very useful for aspiring homeowners. Call your lender for further details.

PERKS FOR FIRST-TIME HOME BUYERS

Although no loan is better than any other, most greenhorn homebuyers buy with a Federal Housing Administration (FHA) mortgage. This loan is the most popular because it was especially designed for people buying a home for the first time.

The FHA loan requires a lower down payment than most mortgages and has easier qualifying criteria than most conventional and veteran loans. The standard FHA loan requires an initial deposit of around 3 percent. This will vary depending on the price of the house you select and whether you pay your own closing costs.