If you would like to learn more about using down payment assistance, please join us at our upcoming class on March 5, 2016, 10am-12pm Complete the Puzzle: Free Money for Home Buyers!
As always if you have any questions about how this would work for you, let one of the Moxie Ladies take you out for coffee and to see if buying is a good fit for you!
We are pleased to present the following information on programs from our guest blogger, Sarah Morris of Sente Mortgage Austin.
It is important to know all the options when you are buying a home. Many people don’t know that down payment assistance programs are available to help with a down payment and/or closing costs—the biggest hurdle for most home buyers!
Contrary to popular belief, you do not always need to be a first-time buyer to qualify, although you must be purchasing your primary residence. And the income limits are higher than you might expect!
The grant programs do not require you to pay the funds back over time, but the second lien programs require you to pay them back—usually when you sell or refinance. A knowledgeable lender can help you figure out if you’re eligible and which option is right for you.
Here is a quick summary of some of the programs offered in Central Texas.
This grant program is open to buyers who work in certain jobs, including teachers, fire fighters, police, correctional officers, and veterans. There is no first time buyer requirement. The Homes for Texas Heroes program provides up to 5% of the total loan amount to cover down payment and closing costs in connection with FHA, VA, USDA, and FNMA HFA Preferred Conventional mortgages.
This grant program benefits low- to moderate-income families. You do not need to be a first time home buyer, but you must meet certain income guidelines that are county specific – for example, someone in Travis County must have an income of not more than $61,440. The Home Sweet Texas Home program provides 2% – 5% of the total loan amount for down payment and closing costs in connection with FHA, VA, USDA, and FNMA HFA Preferred Conventional mortgages.
This grant program is earmarked for homes in Travis County. You do not have to be a first time home buyer and the current annual income limit is $107,520. This program provides 4% – 5% of the total loan amount to be used for down payment and closing costs in connection with FHA, VA, or USDA mortgages.
A grant program to assist in the purchase of a home not located within Travis County. There is no first time home buyer requirement. The general annual income limits for a 1-4 person family is in the mid-$80,000s with an exception to the Freddie Mac HFA Advantage program which goes up to $107,520. The SETH program provides 3% – 6% of the total loan amount to be used for down payment and closing costs in connection with FHA, VA, USDA, or Freddie Mac HFA Advantage Conventional mortgages.
This first time buyer* program provides down payment and closing cost assistance in the form of a no-interest loan of up to 5% of the mortgage loan amount. For families in Bastrop, Caldwell, Hays, Travis, and Williamson Counties, the income limit for a family of 1 or 2 is $76,800 (although a higher income of $92,160 applies in some targeted areas). You must repay the amount of the assistance when you sell, refinance, or pay off your mortgage. The assistance can be used for down payment and/or closing costs in connection with FHA, VA, USDA, or FNMA HFA Preferred Conventional mortgages.
The Down Payment Assistance Program (DPA) covers the down payment in a zero interest loan to first-time home buyers* to assist with purchasing a home within Austin’s city limits. The annual household income limits vary by household size, for example- a family of four cannot make more than $61,450 per year. The Standard program provides up to $14,999 in assistance that is forgiven after 5 years. The Shared Equity program provides up to a $40,000 loan that is forgiven after 10 years and a shared equity component that is forgivable after 30 years. The shared equity component is a percentage that is equal to the percent of your home price that the City helped you cover (for example, if the City helped you cover 23% of your home purchase price, then you will later share 23% of the equity you gain if you transfer the title of your home before the 30 year term has ended).
*First time buyers are persons who who have not owned a home in the previous 3 years, who have been displaced, or who have been divorced.
About Sarah: Sarah Morris transitioned from a career in career placement to mortgage banking to pursue her passion for helping people, while assisting them through what can be one of the largest milestones of their life. Her interest was sparked after her own home buying experience provided little guidance through the loan process. As a mortgage banker, Sarah commits herself to learning from and improving upon this experience for the benefit of her clients. She enjoys playing tennis, traveling, reading, painting, yoga and discovering new places in Austin. Sarah believes that being a mother to two kids has taught her humility, patience, and to appreciate every moment.
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