Louisiana Mortgage and Refinance Rates

Louisiana mortgage overview

Legendary for its food and music, Louisiana homeownership can be very affordable — the median home value in the state is somewhat below average compared to the national median value.

First-time homebuyer programs in Louisiana

The Louisiana Housing Corporation (LHC) offers a diverse list of programs to help make homeownership possible for state residents, including first-time homebuyers. Some of the agency’s programs support purchases in specific regions, or parishes, of Louisiana, while others offer down payment and closing cost assistance no matter where the property is located. Many of the programs have income and purchase price limits.

Mortgage Revenue Bond (MRB) Program

Created for first-time homebuyers whose household income is 80 percent of the area median income (AMI) or less, the Mortgage Revenue Bond (MRB) Program offers down payment and closing cost assistance, along with lower interest rates. The down payment and closing cost assistance ranges from 5 percent to 9 percent, and is based on the loan principal.

Homes purchased using this program must be in Louisiana, and buyers must have a minimum credit score of 640. There are also income and purchase price limits, which vary by region.

Mortgage Revenue Bond Assisted Program

Not to be confused with the Mortgage Revenue Bond Program, the Mortgage Revenue Bond Assisted Program also helps first-time homebuyers who may not have enough money for a down payment or closing costs. However, unlike the Mortgage Revenue Bond Program, the interest rates associated with the Mortgage Revenue Bond Assisted Program are comparable to market rates, and there are exceptions to the limits of the program. For instance, if the property is in what’s known as a “targeted area,” the annual income limit may go as high as 140 percent of the median income.

Like the Mortgage Revenue Bond Program, borrowers in the Mortgage Revenue Bond Assisted Program must meet local income requirements, and the purchase property be in Louisiana. In addition, there is a 640 minimum credit score requirement.

Delta 100 Program

The Delta 100 Program is parish-specific and aimed at first-time homebuyers who do not have a traditional credit history, meaning there’s no minimum credit score to qualify. The program provides as much as 100-percent financing and 3 percent of closing costs. For those who meet program requirements, Delta 100 offers a 30-year, 2 percent fixed-rate mortgage, with no mortgage insurance requirement.

Homebuyers must go through a buyer education course, and also meet minimum investment requirements (1 percent of the property purchase price or $1,500, whichever is less), as well as have sufficient cash reserves to qualify. One caveat: Gifts are not permitted.

Market Rate Ginnie Mae (GNMA) Program

As its name indicates, the LHC’s Market Rate Ginnie Mae (GNMA) Program is a market-rate program providing 30-year, fixed-rate FHA, VA or USDA loans.

To be eligible, borrowers must have a credit score of at least 640, and a household income no more than 115 percent of the area median income (AMI). Like other LHC programs, the purchase property must be in Louisiana.

Also noteworthy, the program, which offers as much as 4-percent assistance for a down payment or closing costs, is open to both first-time homebuyers and repeat buyers.

Mortgage Credit Certificate (MCC)

Aimed at first-time homebuyers and also low- to moderate-income buyers who plan to purchase a property in a designated area in Louisiana, the Mortgage Credit Certificate (MCC) program offers a federal tax credit of as much as 40 percent of the annual mortgage interest payments, up to $2,000 per year, for the life of the loan. The tax credit is available as long as the home remains the primary residence of the buyer. As with MCCs in other states, household income limits vary based on the number of people in the home and the purchase property’s location.

Resilience Soft Second Program

For those with affordability constraints, LHC offers the Resilience Soft Second Program. Through this program, borrowers can get 20 percent of the purchase price, up to $55,000, as well as a maximum of $5,000 in closing costs, in a deferred mortgage, which is only payable if the borrower refinances or sells. If the borrower is in the home for the loan term — 10 years — it will be forgiven.

To be eligible, prospective homebuyers must not have owned a property during the past three years. Single parents who only owned a home with a former spouse while married are also eligible, as are individuals who are displaced homemakers who only owned a home with a spouse previously. Applicants must also have an annual household income at or below 80 percent of the area median income (AMI).

Louisiana mortgage refinancing

Refinancing can have a variety of benefits, such as lowering your monthly mortgage payment if interest rates drop or even shortening the term of your loan. When it comes time to refinance your mortgage in Louisiana, remember you’re not required to work with the same lender you obtained your original mortgage from.

It’s a good idea to do your research, shop around and make sure you’re getting the best possible refinance rate and terms. You’ll also want to compare fees and closing costs offered by various lenders to ensure you understand the full cost of the refinance.

Louisiana mortgage resources

• Louisiana first-time homebuyer resources
• Louisiana loan limits by county