First-Time Home Buyer Programs
in Vermont

Exploring homeownership in Vermont for the first time is a journey unlike any other, weaving together the excitement of finding your perfect place with the unique challenges of our state’s housing landscape. From the competitive, faster-paced markets in Chittenden County to the quiet allure of a homestead in the Northeast Kingdom, the path requires patience and local knowledge. As a first time home buyer in Vermont, you’ll contend with a housing stock that is often older, requiring a keen eye for detail, and navigate the distinct rhythm of our four dramatic seasons, which directly impacts everything from driveway access in the winter to enjoying a screened-in porch during the summer. Success hinges on understanding these nuances from the outset—recognizing that the dream of a mountain view or a village colonial comes with a responsibility to be a steward of that property through mud season, snowfall, and the glorious Vermont autumn. This initial orientation is the bedrock of a successful and joyful purchase.

Fortunately, you are not alone in this endeavor; a robust support system exists specifically to help you. The Vermont Housing Finance Agency, or VHFA, is the cornerstone of these efforts, offering a suite of incredible Vermont first time buyer programs that many potential buyers overlook. Their flagship MOVE program often provides competitive mortgage rates, but the true gem is the accompanying access to down payment assistance. These assistance programs, which can significantly lower the upfront cash needed to purchase a home, are frequently the key that unlocks the door to homeownership. Furthermore, VHFA offers a Mortgage Credit Certificate (MCC), a powerful tax credit that can reduce your federal income tax liability for the life of your loan. Securing these benefits requires working directly with a VHFA-participating lender, a critical step that ensures you’re tapping into all available resources designed to support you.

Navigating the mortgage landscape effectively means choosing a loan that aligns with both your finances and your chosen Vermont property. While conventional loans are a common path, they are far from the only option. For many buyers, an FHA loan in Vermont provides a more flexible path to ownership, especially when credit history or down payment funds are a primary concern. Its versatility makes it a strong choice for multi-family properties in cities like Burlington or Rutland, allowing you to live in one unit and rent out the others. In the vast majority of the state, the USDA Rural Development loan is an absolute game-changer, offering favorable financing for properties in eligible rural areas—which covers a surprising amount of Vermont. Exploring these mortgage options and other first time home buyer programs with a local lender, like a community credit union, who deeply understands our market is a non-negotiable step before you even begin your search.

Once you are pre-approved, the hunt for the right home begins, and in Vermont, this means looking beyond the curb appeal. Your research must dive deep into the specific character of each town and region. Consider your daily life: is a long commute on winding, snowy roads to a job in Montpelier feasible for you? How critical is high-speed fiber internet, which is still a work-in-progress in many areas? As a first time home buyer in Vermont, you should partner with a dedicated buyer’s agent who can help you evaluate these practicalities—from the age and condition of a septic system to the reliability of a drilled well. They will help you understand the vast differences between living in the Champlain Valley, with its lake-effect snow and proximity to services, versus the quieter, more self-sufficient lifestyle of the Green Mountain National Forest region.

Transitioning from an accepted offer to holding the keys involves a distinct legal process here. Vermont is an “attorney state,” meaning your interests are represented by a real estate attorney who will conduct the title search, prepare legal documents, and facilitate the closing. This provides an extra layer of protection but is a process that surprises many out-of-towners. The timeline from contract to closing typically involves a home inspection period—where you’ll absolutely want to test for radon, water quality, and the septic system's health—followed by the lender’s appraisal. Your attorney will coordinate with the seller’s attorney and your lender to ensure a smooth transfer of title. The final walkthrough and the closing meeting itself feel like the culmination of a marathon, a formal yet exciting event where you sign the final papers and officially become a Vermont homeowner.

Beyond the purchase, true homeownership in Vermont reveals itself in the rhythms of maintenance and civic participation. One of your first acts should be filing the Vermont Homestead Declaration (Form HS-122) with your state tax return to declare the property as your primary residence, which makes you eligible for a property tax adjustment. You'll quickly learn to budget not just for your mortgage, but for a winter’s worth of heating oil or propane and the seasonal maintenance our climate demands—from clearing fallen leaves in autumn to managing driveway runoff during the spring thaw. Obtaining the right homeowner's insurance, which may require flood coverage if you're near the Winooski River or another waterway, is also critical. This transition from renter to owner is profound, grounding you in the community and the landscape in a way that is deeply rewarding.