What You'll Learn
- Down payment assistance programs are available for qualified homebuyers like you
- Programs are available at the state, local and municipal level
- Your lender and housing counselor should be able to help you with down payment assistance programs
You've found your first home and your lender has approved you for a mortgage. But there's one catch – you’re short of the cash you need for a down payment.
You're not alone. A great place to start for assistance is right where you live. Many state, county, and city governments provide financial assistance for people in their communities who are well qualified and ready for homeownership.
Did you know?
Did you know that 87% of U.S. homes qualify for down payment assistance?
To provide a better perspective on what help means, let's look at two assistance programs in action:
- Invest Atlanta offers up to $40,000 in mortgage assistance to qualified buyers who buy a home within the city limits
- Neighborhood Partnership Housing Services, Inc. offers up to $18,000 in mortgage assistance to qualified buyers who buy a home within Riverside and San Bernardino counties
Working through your state, local, or city government, you may be eligible for:
- Grants: Funds that you do not need to pay back as long as you own and live in your home for a specific period of time.
- Second mortgage loans: The most common down payment source, these have low or no interest rates and the payments are deferred over a specific time period.
- Tax credits: Certain states and local governments, including Housing Finance Agencies, issue mortgage credit certificates which reduce the amount of income tax you pay, thus giving you more available income upfront to make your down payment or pay for closing costs.
- Reach out to your lender or housing counselor and ask them about state and local down payment assistance programs – they should be able to help
- Visit the U.S. Department of Housing and Urban Development (HUD) directory of state, county, local, and municipal programs to find out what kind of help is available in your area
- Find out if you may be eligible through the Down Payment Resource® tool.
Key Take Aways
Down payment assistance programs can help qualified buyers reach their goal of homeownership
Financial assistance can be provided in the form of grants, second mortgage loans or tax credits
Talk with your lender or housing counselor about down payment programs – or visit HUD's directory of programs