Home financing in Franklin County.

A home loan (also called a mortgage) is money a lender gives you to buy or improve a property. You repay it over time — usually 15 or 30 years — with interest added to each monthly payment. The home itself serves as collateral, which means the lender can claim it if you stop paying.

There are several common types of home loans:

• **Conventional loans** — offered by banks and credit unions, usually require a credit score of 620 or higher and a down payment of 3–20%.

• **FHA loans** — backed by the federal government; allow credit scores as low as 580 and down payments as low as 3.5%. A useful starting point for first-time buyers.

• **USDA Rural Development loans** — because most of Franklin County is classified as rural, many buyers here can qualify for a USDA loan with zero down payment.

• **VA loans** — for eligible veterans and active-duty military, also zero down.

• **Maine State Housing (MaineHousing) loans** — a state-level program with below-market interest rates and down payment assistance, described in more detail in the state programs section below.

Federal programs like FHA and USDA are delivered through local lenders — you don't apply directly to the federal government. That local relationship is what matters most.

Franklin County's economy is built around forestry, agriculture, tourism (Sugarloaf, Rangeley), healthcare (Franklin Memorial Hospital / MaineHealth), and small trades and construction businesses. Many residents are self-employed, seasonal workers, or work for small employers — income patterns that don't always fit neatly into standard loan underwriting.

Here is what lenders look at, and how your situation might be handled locally:

**Credit score:** Conventional loans typically want 620+. FHA accepts as low as 580 (sometimes 500 with a larger down payment). Some local CDFIs and credit unions work with borrowers who have thin credit files or past financial hardship.

**Income verification:** If you're a solo contractor or self-employed, lenders typically average the last two years of federal tax returns. Gaps in employment history are less of a problem if you can show consistent self-employment income. Keep good records — this is the single most important thing you can do.

**ITIN borrowers:** If you do not have a Social Security number and use an Individual Taxpayer Identification Number (ITIN) instead, you can still purchase a home. ITIN lending is a specialty — not every lender offers it, but several institutions serving Maine do. See the local lenders section below.

**Down payment:** The state and local programs described in this guide can help with down payments as low as zero (USDA) or with grants and second mortgages that cover closing costs.

**Seasonal or variable income:** Some lenders in Maine are experienced with seasonal workers. A strong savings history, steady deposits, and a letter explaining your employment pattern can help make your case.

Every lender's checklist is slightly different, but gathering the following documents before you apply will save you time and reduce stress:

**Identity and residency**

- Government-issued photo ID (driver's license, passport, or consular ID)

- Social Security number OR ITIN

- Proof of address (utility bill, lease, or bank statement)

**Income**

- Last two years of federal tax returns (all pages, all schedules)

- Last two years of W-2s or 1099s

- Last 30 days of pay stubs (if you receive them)

- If self-employed: profit-and-loss statement for the current year

- If receiving rental income: current leases and Schedule E from your tax returns

**Assets and debts**

- Last two to three months of bank statements (all pages)

- Documentation of any gifts being used for the down payment (a gift letter is required)

- A list of current debts: car loans, student loans, credit cards, child support

**Property**

- Accepted purchase-and-sale agreement (once you have an offer accepted)

- Contact information for your real estate attorney (Maine is an attorney-closing state)

If you work with a local CDFI or credit union, a loan officer will often sit down with you and help you organize these documents — that hands-on help is one reason local intermediaries are worth approaching first.