Down Payment Assistance

April 9, 2019

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Home Buyers

Down Payment Assistance

A lot of home buyers come to me looking for down payment assistance programs and honestly, I haven’t previously been able to keep up with them.

Not for a lack of trying, but there are a couple of thousand Down Payment Assistance, Affordable First Mortgage and Mortgage Tax Certificate programs available in the United States. Most of those programs are available in some capacity in Indianpolis, Indiana. As if there being so many of them didn’t provide such daunting challenges, they also change frequently and they have funding limitations that can make them disappear or reappear on a moments notice (depending on how they are funded).

The good news is, that I have located a resource that will make it easier for me to keep track of all of these programs so that I may better serve you.

With that in mind, I thought it would be helpful to answer some frequently answered questions about down payment assistance for home buyers, and what you will need to do to get it.

What type of home buyer incentive programs are out there?

For starters, we have the down payment assistance programs. Sometimes these are grants, sometimes they are second mortgages which otherwise would not be available, and sometimes they are forgivable mortgages.

Next there are Affordable First Mortgage Programs… of which the FHA loan is the most recognized.

Lastly There are Mortgage Tax Certificate Programs, which can result in substantial reductions in your Federal or State Tax bill.

Who qualifies for Home Buyers Down Payment Assistance Programs?

When all of the programs are fully funded, almost everyone qualifies for one program or another. Here are some of the ways you could qualify for a down payment assistance program.

  • You are a first time home buyer. (The rules for this are wonky. For some programs that could mean simply that you intend to live in the house, as in it is your first home. Most programs define this as you have not owned a house in the last three years though. A few do require that you are a true first time home buyer.
  • You want to buy in an area with low home ownership, an urban area of targeted revitalization, or a rural area listed as USDA eligible.
  • Income restrictions. One would assume that this meant specifically low income people. While that is the purpose, most of these programs require that your income is merely under the average income in the purchase area. So basically half of all possible applicants qualify. These income levels are also scaled to family size. So if you have a large family, you likely qualify for more than you likely suspect.
  • You work in certain fields. While there are many more employment programs than I am going to list here; you may qualify for home buyer programs such as down payment assistance if you are in Law Enforcement, Education, Firefighting and Rescue, a Medical Field, a Civil Servant, or if you are Active Duty Military¬† (or a Veteran). These programs are also usually extended to peripheral employees of those fields as well, such as the secretary who works for the school.

What are the minimum requirements to get home buyer assistance that I can expect?

There are three main requirements that are nearly universal to these programs.

  1. You must be credit worthy to secure a mortgage.
  2. You must have a FICO credit score of 620 (or higher for many programs)
  3. Almost all of these programs require that you take some time of home ownership class.

Obviously all of these programs have different requirements beyond that, and during your home buyers consultation we will try to determine which is the best fit for you specifically.

What do I need to do to get Home Buyers Down Payment Assistance?

That is the easy part. Schedule a home buying consultation with me, and we will get you started on your home buying journey.