Benefits available to first-time homebuyers include the ability to deduct interest paid on their mortgages, the ability to deduct the points paid upfront at closing and in 2015, the ability to deduct private mortgage insurance. Other benefits include the ability to use itemized deductions as opposed to the standard deductions because more deductions are available for the homeowner to take on his taxes.
In addition to the tax benefits first-time homebuyers receive, there are other advantages, such as access to special loan programs that can assist them into getting a home faster. These programs result in terms that are generally less expensive than those for people who've already purchased a home. Program benefits include low down payments, subsidized interest and a limit to fees a lender can charge. The programs can allow a first-time homebuyer to pay no down payment or one as low as 3 percent of the purchase price.
First time homebuyers may also qualify for government mortgage insurance that's only available to new homeowners. For a yearly premium, HUD insurers the mortgage, which reduces the risk to the lender. The results in the lender being able to charge lower fees and down payments and still gain a profit on the loan.