August 25th, 2008 Categories: Real Estate News
First time buyer programs in Virginia, Maryland and the District of Columbia are a good place to do some research if you are thinking about taking advantage of the current strong, buyer oriented market. These programs are especially valuable now that requirements for down payments have been tightened.
Keith Gumbinger, a vice president at HSH Associates, a real estate research firm noted that ” . . .before you even start shopping for a home, go and investigate potential sources of money. Don’t dismiss grant programs. It really is worthwhile to dig into that stuff. You might not qualify but it doesn’t cost anything to investigate.”
In Virginia, look here for down payment assistance:
Department of Housing and Community Development for two programs that assist low and moderate income individuals. A home buyer can apply for one program or the other but not both.
- Virginia Individual Development Account (888.843.2946) – the state will match every dollar saved by the potential home owner with $2 up to $4000. For instance, if an individual saves $2000, then they would be eligible for up to $4000 from the state to make their down payment.
- Another program for income eligible individuals may provide as much as 10% of the purchase price of the home to cover a down payment. That number moves to 20% in some of the more expensive areas of the state (like Alexandria) through another fund.
Virginia Housing Development Authority (877.843.2123) – this program works with the Federal Housing Authority (FHA). Individuals who have difficulty coming up with the 3% down payment*** required for FHA loans can tap into a state housing financing program. A buyer could receive a 30-year loan for up to 5% of the purchase price to cover the down payment and part of the closing costs.
In the District of Columbia, look here for down payment assistance :
Department of Housing and Community Development (202.442.7200) – for two programs.
- Home Purchase Assistance Program allows eligible first-time home buyers to qualify for a loan of up to $70,000 to cover a down payment for a home in the District. Repayment is deferred for the first 5 years.
- Employee Assisted Housing Program – D.C. government employees, including teachers, police officers and firefighters can apply for matching funds up to $1500 for a down payment. Deferred loans of up to $10,000 are also available for down payment assistance
In Maryland, look here for down payment assistance:
Department of Housing and Community Development has several different areas.
- Down Payment and Settlement Expense Loan Program – borrowers who qualify for the state’s mortgage program may also qualify for a $2500 no interest loan that can be applied to their down payment. The no interest loan is not paid back until the homeowner sells or refinances the home.
- House Keys 4 Employees – individuals who receive a contribution from eligible employers can receive a grant worth up to $5000 for down payment assistance.
- Certain borrowers may also be eligible to receive a grant worth 2-3% of the purchase price of their home that could be applied to their down payment or closing costs.
More House 4 Less offers information on all mortgage products in Maryland (800.638.7781).
*** This will soon change to 3.5% as part of the recent housing bill passed by Congress and signed by President Bush.
Finally, check with Freddie Mac about their Home Possible program designed to help teachers, firefighters, law enforcement officers, health care workers and military personnel, including members of the United States Army, Navy, Air Force, Marines, Coast Guard and National Guard.
Buying a home involves many steps – securing your down payment and loan approval should be the very first one you take. And when you get ready for that second step, call me at 703.927.4554 and we’ll walk through it together.