Down Payment Assistance Mortgage Programs For Home Buyers

Gustan Cho Associates are mortgage brokers licensed in 48 states

This ARTICLE On Down Payment Assistance Mortgage Programs For Home Buyers Was PUBLISHED On October 29th, 2019

Gustan Cho Associates is constantly expanding our portfolio of loan products to help fit the needs of our clients.

  • As we approach the year 2020, we see real estate prices steadily climbing
  • Many experts predict a value crash is coming in the future, but for now, homes are holding high values
  • With higher values, buyers need to increase down payments
  • The down payment can be the single hardest hurdle to jump over to achieve homeownership
  • Many areas of our country such as Dallas, Denver, Los Angeles, and San Francisco (among many others) have home values that are currently through the roof
  • This makes it difficult for families to buy a home
  • Putting them in an endless cycle of paying rent and not building equity
  • I am sure many of you reading this article are sick of making your landlord rich!
  • Our goal is to help you change that
  • Please see our RENTING VS BUYING blog
  • We are happy to re-introduce our down payment assistance program as it is now back up and running
  • In this blog we will detail how this down payment assistance program works, a few of the eligibility requirements, and how to apply for the down payment assistance program

In this article, we will cover and discuss Down Payment Assistance Mortgage Programs For Home Buyers.

What Is Down Payment Assistance?What Is Down Payment Assistance?

Down payment assistance is exactly what it sounds like, it is a specialty loan program that helps you pay all or a portion of your down payment and/or closing costs.

  • Buying a home in the year 2019 is quite expensive
  • Not only do you need a down payment, you need closing costs as well
  • Closing costs include lender fees, title costs, escrows, and state and local taxes
  • An average closing cost can cost anywhere between 2% and 5% of the purchase price
  • This can add up quickly, especially when your main concern is saving for a down payment

This is when down payment assistance can really help you and your family. 

2% DPA Grant For Down Payment

We are excited to have the 2% down payment Grant program available again.

  • This program is available in most states across the country, besides Washington and Hawaii
  • This 2% Grant comes from an approved government entity that allows you to purchase a home with an FHA loan and receive 2% of the purchase price as a down payment assistance grant

This is a GRANT meaning no repayment is needed! 

Underwriting Guidelines And Requirements

What are Mortgage Programs For Home Buyers

Underwriting requirements: 

  • 580 Credit score or higher
  • AUS Approve/ Eligible ONLY (see AUS BLOG for more details)
  • MAX LTV is 96.5% 
  • MAX DTI is 48.99% (DPA overlay)
  • Available in 20, 25, and 30-year FIXED RATE terms

Benefits Of 2% DPA Grant

Who can use this 2% Grant? 

  • For the most part, anybody can use this loan product
  • This program is designed for first-time homebuyers, current or retired public servants, volunteers or non-paid staff members for certain organizations, and lower-income families

Eligibility Requirements For The 2% Down Payment Assistance GrantWhat are Eligibility Requirements For The 2% Down Payment Assistance Grant

Below are a few criteria that must be met in order to use this 2% Grant:

  • The 2% grant must be used to purchase a primary residence
  • This grant is not available for investment properties or second homes

Available to any first-time home buyer, or any person with no ownership interest in a property in the previous three years.

Income Cap Mortgage Guidelines To Become Eligible For DPA

Any borrower whose income is equal to or less than 140% of the county’s medium average.

  • Regardless of family size based upon the state or county where the subject property is located

To look up the income limits for your specific area please visit the FANNIE MAE HOMEREADY INCOME LIMIT LOOKUP TOOL.

Homes For Heroes DPA Mortgage Programs

What are Benefits Of 2% DPA Grant

The 2% grant is also available to any First Responders (including police officers, firefighters, Public Safety officers, paramedics, emergency medical technician, even volunteer fire department staff), Educators, Medical Personnel (nurses, doctors, phlebotomist, Health ambassadors, or any Hospital worker),  Civil Servants at the federal, state, or local level, and any Military Personnel. The program is also available to volunteers. Anybody who has volunteered for charity is eligible for this program. Please call us for more specifics.