Homebuyer Assistance Programs
- Down Payment & Closing Costs Assistance
- Affordable First Mortgages
- Mortgage Credit Certificates
Qualifications
The buyer and the property both must be eligible.
The buyer must be purchasing a home which they will live. The property must be owner occupied (no investment properties).
Buyer needs to be able to make a minimum investment, qualify for a first mortgage and complete a homebuyer education program. Although some programs require that buyer be a first-time homebuyer, there are plenty of programs that do not carry this requirement. A first-time homebuyer is anyone that hasn’t owned property in the past 3 years, even if they owned property prior to 3 years ago.
Down Payment & Closing Costs Assistance
Down payment assistance programs are offered by federal, state, county or local government agencies as well as nonprofit organizations and employers.
The two most common forms of Down Payment Assistance are grants and 2nd mortgages. Grants do not need to be paid back. Second mortgage loans have varying payback requirements and may have an interest rate as low as 0%.
Affordable First Mortgages
Many larger housing finance agencies offer first mortgages to go along with their down payment assistance programs. These are often funded by state housing finance agencies. They may contribute to some of the interest and thereby able to offer rates below what the regular market can provide. This could help lower buying costs and monthly payments. They may also offer reduced closing costs and fees as well as waiving MI requirements.
Mortgage Credit Certificates
This federal income tax credit is offered to help first-time homebuyers offset a portion of their mortgage interest. As a tax credit, the Mortgage Credit Certificate helps reduce annual taxes dollar for dollar and can often be used in conjunction with another homebuyer assistance program.