Homebuyers in New Mexico have another option for assistance with purchasing a home.

Housing New Mexico has launched a pilot program — NewHome Rate Advantage — offering a permanent 1% interest rate buydown on a fixed-rate 30-year first mortgage. The program is available to qualified homebuyers purchasing a newly constructed home through Housing New Mexico’s HomeForward program. Borrowers must apply through approved Housing New Mexico participating lenders.

NewHome Rate Advantage is being funded with the New Mexico Housing Trust Fund.

“Thanks to legislators and Gov. Michelle Lujan Grisham for the appropriations into the New Mexico Housing Trust Fund,” said Housing New Mexico Executive Director/CEO Isidoro Hernandez. “This pilot program will help many New Mexicans purchase a home. This is an innovative program to address the affordable housing challenges in our state, and we appreciate the collaboration with the New Mexico Home Builders Association to bring this program to fruition.”

The monthly payment savings will depend on the loan amount. For example, it is estimated that the interest rate buydown on a $300,000 loan could result in a monthly savings of $188 for the homeowner.

The home being purchased may be site-built, detached or attached, and the certificate of occupancy must not have been issued more than 12 months prior to the date of purchase. Homes may be located anywhere in New Mexico, including on Federally Designated Tribal Land.

“New Mexico Home Builders Association is proud to partner with Housing New Mexico/MFA to launch the NewHome Rate Advantage Program,” said New Mexico Home Builders Association CEO Miles D. Conway. “When every $1,000 reduction in a home’s price allows more than 1,000 additional New Mexico families to qualify for a mortgage, this permanent rate buydown opens the door to the American dream of homeownership for thousands of hardworking families. By expanding the pool of qualified homebuyers, this program will rapidly and effectively enable our state’s family-owned builders to construct the attainably priced homes New Mexico urgently needs. It represents a vital step toward a future where more New Mexicans can afford a place to call home.”

This program is only for borrowers who will occupy the home as their primary residence. It is not available to borrowers seeking to purchase an investment property, rental property or a second home.

The NewHome Rate Advantage program is available to qualified homebuyers purchasing through Housing New Mexico’s HomeForward program. The home must meet HomeForward’s income and purchase price limits.

Interested buyers should consult with Housing New Mexico participating lenders.

Housing New Mexico began accepting loan reservation requests for this program from participating lenders on behalf of their clients in late July.