Down Payment Assistance Program
Looking for a loan that puts a new house’s keys in your hands? You’ve come to the right place!
There are many lenders and mortgage programs out there that will fit your financial needs. Finding them is just a matter or understanding how they work and knowing where to look!
What are Down Payment Assistance Programs?
These are programs designed to help qualified homebuyers get a home by providing a set amount of money to help cover down payment or closing cost expenses. Great for borrowers with limited resources or not enough savings to cover down payments, they are an appealing alternative for first-time buyers, significantly reducing the initial costs that usually come with a mortgage.
Down payment programs are primarily offered by your county or state, and administered by either local, or state housing authority, a nonprofit, or directly through lenders. Money received through these programs can be considered either a grant, an interest-free loan or a debt to be paid at a future date. Down payments assistance programs tend to be based around particular properties and are intended to give home buyers a much-needed bump at the beginning, as coming up with down payments tends to be one of the biggest hurdles to overcome when buying a property.
There are thousands of programs like these all over the country, with varying degrees of requirements, so keeping an eye out for those you can apply for is recommended.
Already have a loan on your sights? Use our mortgage calculator and make sure it’s the right one for you!
Down Payment Assistance Program Advantages:
- No strings attached assistance.
- Great way to partially or entirely cover down payments.
- Funding can go as high as tens of thousands of dollars.
Down Payment Assistance Programs – Notable Requirements
Different types of loans vary wildly on their qualification requirements. Doubly so here, where each program comes with its particular guidelines.
While these might not be all the requirements to qualify for every Down Payment Assistance Program, they tend to be the most common:
- Most down payment programs have qualification requirements for both, the homebuyer and the property being purchased.
- There are household income thresholds, credit score minimums, and cash reserve requirements (all varying from program to program).
- Many programs are designed for first-time buyers and require first-time homebuyer status.
- The home must be your primary residence.
- There are limiting criteria regarding home sales prices for the property you intend to buy.
Down Payment Assistance Programs & Accessibility –
All You Need to Know:
Down payment assistance programs are great for providing that little extra help when you are gearing up to get your loan, but would still need assistance with coming up with the down payment. It is essential to keep in mind though, that borrowers will receive higher interest than what they would usually qualify for. Furthermore, they’ll have the loan for several years before they can refinance it, or sell the property without penalty.
Having said that, there are a lot of DPA programs out there with varying degrees of requirements, which does wonders for their accessibility. Some give more weight to your income and the price of the property you are going to buy than to your credit score. Also, be aware that some professions might give you an edge for qualification. Many DPA programs are designed and favor individuals that provide a valuable service to the community (educators, healthcare workers, etc.).
Lastly – and contrary to some beliefs – DPA programs are available throughout the whole country. In every type of community and often for homes at price ranges above the median for a given area.
Ready to get that Down Payment Assistance Program you’ve been looking for? Let us help!
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