What to know about buying a house in South Carolina
South Carolina first-time home buyers have plenty of resources at their disposal. The state offers home buyer education classes, special mortgages, and down payment assistance. These resources can help you navigate the home buying process and make informed decisions.
Ready to take your first step toward buying a home? Here’s what you should know.
In this article (Skip to ...)
- SC home buyer overview
- Home loan options
- SC home buyer programs
- First-time buyer grants
- Buying in South Carolina’s cities
- Resources
- SC mortgage rates
South Carolina home buyer overview
The median home sale price in South Carolina was $300,000 in February 2023, according to South Carolina REALTORS. That was a 0.06% increase from the previous year.
South Carolina first-time home buyers may face challenges like a competitive housing market and rising home prices. However, there is hope. The Palmetto State has mortgage loans and grants to help ease the cost of buying a home, making it easier for people who qualify to become homeowners.
South Carolina home buyer stats
| Average Home Sale Price in SC1 | $300,000 |
| Minimum Down Payment in SC (3%) | $9,000 |
| 20% Down Payment in SC | $60,000 |
| Average Credit Score in SC2 | 696 |
| Maximum SC Home Buyer Grant3 | Up to 5% of the loan value statewide through Palmetto Home Advantage |
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 South Carolina
If you’re a first-time home buyer in South Carolina with a 20% down payment, you can get a conventional loan with a low interest rate and no private mortgage insurance (PMI).
Of course, only some first-time buyers have saved enough for 20% down. But the good news is that 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 when you have 20% 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 premiums (MIP) until you refinance to a different type of mortgage, move, or pay off your loan
- VA loan: Only for veterans and military service members. Zero down payment is required. Minimum credit score varies by lender but often 620. No ongoing mortgage insurance premiums 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
- SC Housing: May include competitive interest rates and 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.
In addition, most programs let you use gifted money or down payment assistance (DPA) to cover your down payment and closing costs. Depending on your mortgage loan, you could get into your new house with minimal cash out of pocket.
If you’re unsure which program to choose for your first home purchase, your lender can help you find the right match based on your finances and home-buying goals. Also, your real estate agent or Realtor can help identify loan programs that may be suited to your needs.
South Carolina first-time home buyer programs
The South Carolina State Housing Finance and Development Authority (SC Housing) offers competitive mortgage loans and down payment assistance to help families and individuals become homeowners. SC Housing does this by offering fixed-rate mortgage loans combined with money to help cover the down payment and closing costs.
SC Housing Homebuyer Program
Low-to-moderate income buyers may find what they’re looking for with South Carolina’s homeownership assistance program. Support comes in the form of a 30-year mortgage with a fixed interest rate, which can be used with either a Conventional 97 or any of the government-backed loans: FHA, VA, or USDA.
You’ll need a credit score of 620 or higher for an FHA loan and 640 or higher for all other types of mortgages. And there are household income limits as well as purchase price caps.
As is usual with state-run mortgage programs, you’ll need to choose a lender from SC Housing’s approved list. And you must complete a home buyer training course. You can download a PDF of SC Housing’s Homeownership Program handout for those caps and other details.
SC Housing Palmetto Home Advantage
SC Housing’s Palmetto Home Advantage program is not only for first-time homeowners, but you can use it to make your first home purchase. The program provides discounted interest rates and down payment assistance of up to 4% of the loan amount. The program also offers a lower rate on mortgage insurance for those who put down less than 20% of the home’s purchase price.
You must meet income requirements and have a minimum credit score of 640 to be eligible. Eligibility requirements will vary depending on whether you’re applying for a conventional, FHA, VA, or USDA loan.
SC Housing First Initiative
County First is a rural home loan that aims to give potential homebuyers in underserved areas more help when the local economy makes it hard for them to buy a home. Both first-time and repeat borrowers can apply for funding. The program offers up to $8,500 in forgivable down payment assistance and lower fixed-rate loans. Borrowers can select between FHA, conventional, USDA, and VA loans.
County First funding is available to people who want to buy a home in Abbeville, Allendale, Bamberg, Barnwell, Calhoun, Chester, Chesterfield, Clarendon, Colleton, Dillon, Edgefield, Fairfield, Georgetown, Hampton, Jasper, Lee, Marion, Marlboro, McCormick, Newberry, Saluda, Union, and Williamsburg. Income and property price guidelines are the same as in our SC Homebuyer Program. Single-family homes, condominiums, townhomes, and modular homes are all eligible for financing.
SC Housing Palmetto Heroes
SC Housing also operates the Palmetto Heroes Program. This normally helps buyers working in medicine and the military, plus teachers, police officers, and other public servants. But, when we checked the webpage, it said, “Due to overwhelming demand, the 2022 Palmetto Heroes Program has been closed.”
Presumably, the program may be open to applicants again in 2023. So check back to see if things have changed.
South Carolina first-time home buyer grants
First-time home buyer grants in South Carolina make it easier for eligible people to buy their first homes by helping them pay for the down payment and closing costs. These grants usually come from state and local government programs, non-profit groups, and private organizations. They can be worth anywhere from a few thousand dollars to tens of thousands of dollars.
SC Housing Forgivable Down Payment Assistance
SC Housing doesn’t offer grants to South Carolina first-time home buyers. But it does offer forgivable second mortgage loans to those who are eligible. Those forgivable second mortgages are fairly lenient. They charge 0% interest and require no monthly payments. And they last for either 10 years or 20 years, depending on your household income. Your loan will be forgiven in full at the end of that period.
However, the website says, “The borrower must occupy the subject property for the term (10 or 20 years) of the lien for the assistance to be fully forgiven.” So, if you move before then, you may have to repay some or all of the original loan.
SC Housing doesn’t specify how much the loans can be worth. But it says the funds can go toward your down payment, closing costs, and prepaid items (which include upfront property taxes and homeowners insurance due at closing).
Palmetto Home Advantage DPA
SC Housing also operates the Palmetto Home Advantage program. This can offer down payment assistance of up to 4% or 5% of the loan amount. You’ll need at least a 640 credit score to qualify. Similar to the SC Housing Homeownership Program, this is a ten-year forgivable loan with a 0% interest rate.
SC Housing Choice Voucher Homeownership Program (HCV)
SC Housing gives people who are already in the Housing Choice Voucher program the chance to participate in a homeownership program that will help them move from renting to owning. If a family meets the following requirements, the rental voucher can be changed into a voucher for buying a home.
- The head of household must be an active HCV participant and have leased a home using an HCV/Section 8 voucher for at least one year.
- The voucher family must currently be in good standing and in accordance with all HCV program standards.
- The head of household and/or spouse must have maintained continuous full-time employment for at least one year.
Visit the program website if you’re interested in learning more about the requirements.
SC Mortgage Credit Certificates
Finally, SC Housing offers the SC Mortgage Tax Credit Program is a Mortgage Credit Certificate (MCC) for home buyers. It can provide a tax credit of “up to $2,000 per year for the life of the loan.”
SC Housing also says, “The credit can also be used as additional income on a mortgage application to allow a borrower to lower their debt ratio to help qualify for a loan or be able to qualify for a larger loan.”
If you’d like clarification, call (803) 896-2211 or email mortgage.production@schousing.com.
Other South Carolina First-Time Home Buyer Assistance Programs
In addition to getting help from the state, you might be able to get help buying a home through a local program. While the down payment forgiveness period for SC Housing is 10 to 20 years, some local options offer shorter timeframes for paying off loans for down payments and closing cost assistance.
These programs are meant to help families with low to moderate incomes realize their dream of owning a home by giving them money for a down payment and closing costs. The eligibility requirements for these programs may differ, so people who want to know more should contact the organizations that run them.
Richland County Homeownership Assistance Program
Richland County Community Development helps low- and moderate-income families with down payments and closing costs by giving them loans of up to $10,000 that they don’t have to pay back. For information on the program’s benefits and eligibility requirements, go to the program’s website or contact the Ombudsman Response Center at (803) 929-6000 or ombudsman@richlandcountysc.gov.
City of Rock Hill First-Time Homebuyer Program
Through a second mortgage that doesn’t have to be paid back, the Housing Development Corporation of Rock Hill gives eligible homebuyers up to $5,000 to help with their down payment and closing costs.
Greenville County Community Works DPA
In Greenville County, the CommunityWorks down payment assistance program offers up to $5,000 in down payment assistance that can be forgiven in five years or up to $10,000 in down payment assistance that can be forgiven in eight years.
Buying a home in South Carolina’s major cities
Home price inflation in South Carolina’s three biggest cities hasn’t been too far off the statewide average. But, especially in hot real estate markets like Charleston, rising prices can present a challenge for first-time home buyers.
Luckily, there are statewide and local down payment assistance programs to help. First-time home buyers may find friendlier market conditions in Columbia, where homes are cheaper than the statewide average.
Charleston first-time home buyers
In March 2023, the median list price of homes in Charleston was $539,000, an increase of 15.9% 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:
- $16,170 for 3% down payment
- $107,800 for 20% down payment
The City of Charleston’s Homeownership Initiative can provide down payment assistance to first-time buyers. However, it partners with various agencies and can’t give many details because each organization offers different amounts on different terms.
Help is available to qualifying borrowers with incomes between 50% and 120% of the area median income. People wishing to buy in five target neighborhoods get priority. You’ll need to complete a home buyer education course to qualify.
Download the city’s down payment assistance brochure. And if you still need more information, call (843) 724-3766.
Columbia first-time home buyers
In March 2023, the median list price of homes in Columbia was $238,000, an increase of 5.8% 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:
- $7,140 for 3% down payment
- $47,600 for 20% down payment
Richland County, which includes Columbia, has a down payment assistance program that can provide up to $10,000 to qualifying borrowers. That comes in the form of a forgivable second mortgage. So you get a 0% interest rate and don’t have to make monthly payments.
The loan lasts for five years. And, provided you don’t move out of the home during that time, it should be fully forgiven at the end of that time.
For more information, call (803) 576-2052 or download the FAQ sheet.
North Charleston first-time home buyers
In March 2023, the median list price of homes in North Charleston was $335,000, an increase of 15.5% year-over-year, according to Realtor.com.
If you want to buy a home at that median sales price, your down payment options might fall between:
- $10,050 for 3% down payment
- $67,000 for 20% down payment
Unfortunately, we could find no down payment assistance programs run by the City of North Charleston. However, it may be worth checking whether the county in which you wish to buy (the city is within Berkeley, Charleston, and Dorchester counties) offers one.
Where to find home buying help in South Carolina
All the organizations we’ve listed above should provide free advice to any first-time home buyer in the state of South Carolina or in their local areas.
In addition to our selection, the U.S. Department of Housing and Urban Development (HUD) provides a list of statewide resources:
- South Carolina State Housing Finance and Development Authority: Home buyer assistance loans and first-time home buyer mortgages. See its eligibility requirements, list of participating lenders, and Homeownership Program handout
- SC Housing Palmetto Heroes Program: Homeownership for select South Carolina first-time home buyers
- City of Charleston’s Homeownership Initiative: Housing assistance for first-time buyers in Charleston, South Carolina. Download the down payment assistance brochure for more information
- Greenville County Redevelopment Authority (GCRA)
- Richland County Homeownership Assistance Program: Down payment and closing cost assistance for qualifying home buyers. See the program’s FAQ sheet
- Rock Hill First-Time Homebuyer Program
- USDA Rural Development in South Carolina
- HUD-approved housing counseling agencies in South Carolina
- HUD Community Development Block Grant (CDBG) recipients in South Carolina: HUD provides CDBG grants to local communities; some communities use this funding to assist homeowners with repairs
- Habitat for Humanity: Contact your local affiliate for information and assistance
What are today’s mortgage rates in South Carolina?
You can see today’s live mortgage rates in South Carolina here. Experiment with a mortgage calculator to see how a down payment, interest rates, homeowners insurance, and property taxes affect your monthly mortgage payments.
Get personalized rate quotes from at least three mortgage lenders when you’re ready to begin the home-buying process. Don’t settle for the first online rate you see. Apply for preapproval and compare the interest rates and fees you’re offered. That’s the only way to ensure you get the best deal on your new home loan.
1Source: South Carolina REALTORS Monthly Indicators Report
2Source: Experian.com study of 2022 and 2021 data
3Based on a review of the state's available DPA grants at the time this was written
