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Finding Down Payment Assistance for Your Home Purchase

Finding Down Payment Assistance for Your Home Purchase . 0

In our prior blog post, we discussed the down payment minimums required by different types of mortgages. While these requirements can be as low as 3%, the rising cost of homes make saving for that percentage a moving target. Add in the rising cost of rent, and it’s a double-squeeze on the budget.

Fortunately, down payment assistance is available through various organizations around the country! The exact structure and availability of each program depends on the grantor. Typically, they offer an interest-free loan as a down payment, which then becomes a gift, so long as the home buyer honors all conditions. In other cases, there are lease-to-own programs that apply on-time rent payments towards the down payment.

There are also specialized mortgages designed to aid home buyers who are under-served by traditional mortgage products. For example, the Neighborhood Assistance Corporation of America (NACA) partners with national lenders to offer unique mortgage solutions. These include mortgages without any down payments, closing costs or fees.

Government-sponsored entity Fannie Mae offers mortgage assistance for first-time home buyers through the Home Path program. After completing a home buying education course, buyers who purchase a Home Path property can get up to 3% in cash assistance.

The United States Dept. of Agriculture and Rural Development offers a Guaranteed Loan Program for low-to-moderate income home buyers in rural areas. Many suburban markets are considered “rural” by USDA; the property does not need to be remote. Find a participating, USDA-approved lender for more information.

There are a variety of home buying and down payment assistance programs available at the state and local level. You can find a comprehensive list of housing agencies by visiting the Public Housing Authorities Directors Association website.

Additionally, some employers may offer home buying assistance and incentive programs, above and beyond the standard relocation package. Ask your employer’s Human Resource department about these types of benefits.

Because Exclusive Buyer Agents only represent home buyers, your local EBA often knows of down payment assistance programs that are available within certain market areas. He or she can also refer you to trustworthy lenders and agencies for more information!

Find an EBA in your area today!