Saving enough for a down payment to buy a home is hard and may take years.
However, Down Payment Assistance grants are an alternative that can help you accomplish your down payment goal faster.
DPA grants are offered by commercial banks as part of the Community Reinvestment Act which aims to help meet the needs of borrowers in all segments of their communities, including low-and moderate-income neighborhoods. Nonprofit organizations and local municipalities also offer grants to make homeownership affordable and available to more people.
If you have a 640 Credit Score and earn less than $80,300 in annual income, you may be eligible for a Home Possible Grant to cover your down payment. In conjunction with the grant, the bank is also offering credit toward your closing costs. Combined, they include:
• A 3% grant up to $10,000 for down payment
• Bank credit for up to $7,500 toward your closing cost
What’s the catch and why offer as much as $17,500 for a buyer to purchase a home? Banks are expected to reinvest in the communities they serve and help meet the credit needs of all members of a community including low to moderate-income neighborhoods. Local municipalities benefit because higher rates of ownership will often encourage residents to invest in the stability and wellbeing of their community. There is no catch, but there are some basic requirements:
• The home must be your primary residence.
• You must live in the house a designated number of years, usually 3, before selling. If you sell before that time, you’ll be required to pay back the grant from the sale proceeds.
The best way to get more information is to speak with a REALTOR® that has undergone specialized DPA training or a Mortgage Lender that offers them as part of their loan portfolio. Either way, there is no obligation to have a phone discussion with a specialist. You can Register here to learn more about how these and other resources can help you or call 972-900-9900 for immediate assistance.