There is a lot that goes into buying a home. Between getting approved for a mortgage, finding the perfect house and navigating the closing process, it’s easy for first time home buyers to find themselves surprised at its complexity.
Another thing they may find themselves unprepared for is the cost of a down payment. Obtaining the down payment is the biggest challenge many first time home buyers face.
Down payments can be a hefty cost for most homebuyers. However, there are options for many first time home buyers, or those who haven’t bought a home in more than three years, according to Fox Business. This help comes in the form of down payment assistance programs.
Down Payment Assistance Programs (DPAs) are offered by city, county, state and government housing finance agencies, including nonprofit organizations. They assist qualified homebuyers with achieving homeownership by providing funds toward the borrower’s down payment, closing costs, or other upfront expenses. According to Fox Business, there are more than 2,000 DPAs, though many people are unaware of them. A survey by NeighborhoodWorks America found that 70 percent of Americans don’t know about these types of options for middle-income homebuyers in their community.
North Carolina Fox affiliate My Fox8 explained how a local DPA is helping 1,000 homebuyers in North Carolina by offering up to $15,000 to each buyer planning to purchase a home worth less than $245,000 in certain counties where foreclosures were common.
DPAs are typically geared to assist first time home buyers toward the purchase of a primary, owner-occupied residence. Borrowers must qualify for the first mortgage loan product and qualify for a particular DPA program, which takes into account income limits, purchase price limits, property type, property location and other factors. DPAs are commonly referred to as community seconds (secured seconds and silent seconds) and nonprofit gift or grant programs. Make sure to consult with a qualified mortgage lender who can help you navigate the different programs and rules.
The programs aren’t necessarily for low-income people; rather, they are for those who may not have a down payment saved up. This is a great option for younger homebuyers, who may not have been able to begin saving for a down payment between paying for student loans and having just entered the workforce. DPAs give these millennials a way to help realize their dream of homeownership.
To learn about how a down payment assistance program can help you, contact Lenox/Weslend Financial or call 844-225-3669. We work with various state and local assistance programs. As heard on the radio, it’s the biggest no-brainer in the history of mankind.