Kansas First-Time Home Buyer | 2022 Programs and Grants

What to know about buying a house in Kansas

Average home prices in Kansas are significantly lower than in the rest of the nation ($342,200 in Mar. 2022 versus $412,260 nationwide). That’s good news, although it can still be difficult to save for a down payment and closing costs.

Luckily, Kansas — as well as some of its cities and counties — runs some very good down payment assistance programs for buyers who qualify. So read on to learn about loans and grants that could help you with your home buying goals.

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Kansas home buyer overview

In March 2022, the median listing price for homes in Kansas was $342,200 according to Redfin. That was a price increase of 5.8% year-over-year — far lower than the nationwide average increase of 17.1% year-over-year. So first-time home buyers in Kansas can be glad that home prices aren’t rising as quickly as elsewhere in the country.

Kansas home buyer stats

Average Home Listing Price in KS	$342,200
Minimum Down Payment in KS (3%)	$10,270
20% Down Payment in KS	$68,440
Average Credit Score in KS1	721
Maximum KS Home Buyer Grant2	Up to 20% of home price + $2,000, only in Wichita

Down payment amounts are based on the state’s most recently available average home sale price. “Minimum” down payment assumes 3% down on a conventional mortgage with a minimum credit score of 620.

If you’re eligible for a VA loan (backed by the Department of Veterans Affairs) or a USDA loan (backed by the US Department of Agriculture), you may not need any down payment at all.

First-time home buyer loans in Kansas

If you’re a first-time home buyer in Kansas with a 20% down payment, you can get a conventional loan with a low interest rate. And you never have to pay for private mortgage insurance (PMI).

Of course, few first-time buyers have saved enough for 20% down. But the good news is, you don’t need that much. Not by a long shot.

Borrowers can often get into a new home with as little as 3% or even 0% down using one of these low-down-payment mortgage programs:

• Conventional 97 — From Freddie Mac or Fannie Mae. 3% down payment and 620 minimum FICO score. You can usually stop paying mortgage insurance after a few years once you reach 20% home equity
• FHA loan — Backed by the Federal Housing Administration. 3.5% down and a 580 minimum credit score. But you’re on the hook for mortgage insurance until you refinance to a different type of mortgage, move, or pay off your loan
• VA loan — Only for veterans and service members. Zero down payment is required. Minimum credit score varies by lender but often 620. No ongoing mortgage insurance after closing. These are arguably the best mortgages available, so apply if you’re eligible
• USDA loan — For those on low-to-moderate incomes buying in designated rural areas. Zero down payment required. Credit score requirements vary by lender but often 640. Low mortgage insurance rates
• Kansas Housing loans — May come with generous down payment assistance. More information below

Note that government loan programs (including the FHA, VA, and USDA home loans) require you to buy a primary residence. That means you can’t use these loans for a vacation home or investment property.

Depending on the mortgage loan you choose, you could potentially get into your new house with minimal cash out of pocket. These programs even let you use gifted money or down payment assistance (DPA) to cover the down payment and closing costs.

If you’re unsure which program to choose for your first mortgage, your lender can help you find the right match based on your finances and home buying goals.

Kansas first-time home buyer programs

Kansas Housing doesn’t appear to offer special mortgages to first-time buyers, unlike most other states. But, if you borrow through a lender on the organization’s approved list, you may be in line for down payment assistance. Read on for more about that.

Work with a lender on that approved list to decide what type of mortgage would suit you best (FHA, VA, USDA or conventional — see above). But get quotes from several lenders. Mortgage rates and eligibility vary considerably between different lenders and you need to find the one offering the best deal.

Kansas Housing doesn’t impose any qualifying criteria beyond those set by your chosen mortgage program. But there are special requirements if you want down payment assistance.

Kansas first-time home buyer grants

For the right buyer, Kansas Housing’s First Time Homebuyer Program can offer significant help with your down payment. Here are the main details:

• You can borrow 15% or 20% of the purchase price as a second mortgage. So you may be able to get a conventional loan with no mortgage insurance
• That second mortgage is a “silent” one. That means a 0% interest rate and no monthly payments
• As long as you’re still in residence and haven’t sold, transferred the home, or refinanced your mortgage by the end of Year 10, the loan is forgiven. Yep — the debt just disappears
• The loan is forgiven in stages over time. If you move or sell, transfer ownership or refinance during those 10 years you will still owe the unused portion

There are a few requirements, though.

To start with, there are household income limits; yours must be below the average in your area. Check the income caps that apply where you wish to buy. You must also contribute 2% of the home’s purchase price from your own pocket.

Then, even if you qualify, you need to plan to live in your home for many years — ideally, at least 10. But the longer you stay below that, the more you’ll benefit.

Note that this program doesn’t operate in Topeka, Lawrence, Wichita, Kansas City, or Johnson County. That’s because those places have their own down payment assistance programs and you should apply to those.

If you qualify, have your 2% contribution, and plan to stay put for a decade, this is a brilliant offering. Otherwise, not so much.

Buying a home in Kansas’s major cities

Some of the Sunflower state’s most affordable housing is to be found in Wichita and Kansas City. So any Kansas first-time home buyer should check those out, provided they meet your plans, needs, and lifestyle. Unfortunately, if your heart’s set on Overland Park, prices are a little higher.

Wichita first-time home buyers

In March 2022, the median list price of homes in Wichita was $185,000. That was an increase of 6% year-over-year, according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

• $5,550 for 3% down payment
• $37,000 for 20% down payment

The City of Wichita’s Housing & Community Services department offers its HOMEownership 80 Program. You’ll need a relatively modest income to qualify. Check out the income caps at that last link.

Like Kansas Housing’s offering, this appears to be a forgivable, silent, second mortgage. So, no monthly payments and a 0% interest rate. And you may be able to borrow up to 20% of the home’s purchase price plus $2,000 toward closing costs, though that’s capped at “the amount required by your first mortgage lender for loan approval.”

As for the “forgivable” part, the website says: “One-half of the loan will be forgiven following a period of 5 years if your loan is less than $15,000, or a period of 10 years if your loan is greater than $15,000. You must continue to
own and occupy the home for the specified period to be eligible for loan forgiveness. Your loan documents will specify the exact terms in this regard.”

Overland Park first-time home buyers

In March 2022, the median list price of homes in Overland Park was $375,000. That was an increase of 10.3% year-over-year, according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

• $11,250 for 3% down payment
• $75,000 for 20% down payment

Overland Park does not seem to have its own down payment assistance program. But you can apply to Kansas Housing’s program (above) instead.

Kansas City first-time home buyers

In March 2022, the median list price of homes in Oklahoma City was $179,500. That was an increase of 19.7% year-over-year, according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

• $5,390 for 3% down payment
• $35,900 for 20% down payment

Kansas Housing says its program doesn’t extend to Kansas City because the city has its own down payment assistance program. But we searched the website of the Unified Government of Wyandotte County and Kansas City and could find no trace of one.

We suggest you call the unified government’s offices at (913) 573-5311 to see if we’ve missed something. If we haven’t, call Kansas Housing on (785) 217-2001 to see if you can apply to it after all.

Where to find home buying help in Kansas

In addition to our selection, the U.S. Department of Housing and Urban Development (HUD) provides lists for statewide, regional, and local resources:

Statewide and regional Kansas first-time home buyer programs

Kansas home buyer programs by city/town

• Lawrence — Homeownership assistance programs through a partnership of the City of Lawrence and Tenants To Homeowners
• Leavenworth — First Time Home Buyer Assistance Program
• Topeka — Home Buyer Assistance Program (Topeka Opportunity To Own)

What are today’s mortgage rates in Kansas?

You can see today’s live mortgage rates in Kansas here.

When you’re ready to start the home buying process, make sure you get personalized rate quotes from at least three mortgage lenders.

And don’t just look at advertised rates online; actually apply for preapproval and compare the interest rates and fees you’re offered. Because that’s the only way to know you’re getting the best deal possible on your new home loan.

¹Source: Experian.com 2022 study of 2021 data

²Based on a review of the state’s available DPA grants at the time this was written