Remember when you made the resolution to do something big this year? Understand that time will not wait for you. Now that we have some time, let me show you how you can obtain funds to buy a house. You may be asking, “Is it possible for certain organizations to give you money that you can apply toward purchasing your house.” The answer is “Yes, it is possible!” I have the insider tips to share with you as it relates to Colorado.
Enroll in an Assistance Program
When I purchased my first home, I enrolled in a program which gave me a forgivable loan toward my down payment, gifted me new appliances and installed them for me. Such a program is called a down-payment assistance program, but not all of such programs are the same. However, it is very important to utilize your resources when it comes to making a big purchase like a home.
A down-payment assistance program is an important resource for individuals and families looking to purchase a home, because they can help make it more affordable by reducing the amount of money that needs to be saved for a down payment.
Are you eligible?
Eligibility for a down-payment assistance program depends on the type of program. The program often targets first-time homebuyers, low-income households, or households in specific geographic areas. It’s worth noting that some of these programs may have specific requirements or restrictions, such as income limits, credit-score requirements, or restrictions on the type of home that can be purchased. It’s also worth noting that many of these programs may have limited funds available, and they may be offered on a first-come-first-served basis. Therefore, it’s essential to research and apply for these programs as soon as possible.
Types of Down-Payment Assistance Program
There are two major types of down-payment assistance programs: grants and loans. Some programs offer loans that may be forgiven after you’ve owned your home for a specific length of time. Here is a breakdown of the two major types:
- Grants: These are funds that you do not have to repay. You can use these funds toward the down-payment and closing costs of a home.
- Second Mortgages/Loans: These are funds that must be repaid and can be used towards the down payment and closing costs of a home. Most times, these loans do not require monthly payment but a lump-sum payment whenever you sell or refinance the home.
Down–Payment Programs that you should definitely go for:
- The Chenoa Fund: This is a national program that aims to provide financial assistance to individuals looking to buy a home. It offers a range of options for down-payment assistance, such as 3.5-5% on FHA loans and 3-5% on conventional loans. They have a forgivable loan that has a 0% interest rate and a 30-year term, with no monthly payments required. The 3.5% assistance amount is forgivable after 36 consecutive on-time payments on the FHA first mortgage. Learn more by visiting: https://chenoafund.org/ or contact me for details.
- CHFA: This offers homebuyers two options for down-payment assistance, including a grant of up to 3% of the first mortgage cost, which does not require repayment, and a second mortgage loan of up to 4% of the first mortgage. These options provide financial help for the down payment on a home, making it more accessible for people to buy. Learn more by visiting: https://www.chfainfo.com/ or contact me for details.
- Bonus- PATH program with FirstBank: The Projects for Assistance in Transition from Homelessness (PATH) Grant program aims to make homeownership more accessible for the Black- and African-American community in Colorado by providing down-payment assistance of up to $15, 000. To be eligible, you must be Black, a first-time homeowner, and take a 6 hour first-time homebuyers class. Learn more by visiting: https://www.efirstbank.com/ or contact me for details.
- The Metro DPA: This program offers substantial financial assistance for down payments, up to 6%. To be eligible, there are certain requirements such as an income limit of $150,000, and a minimum FICO score. However, program requirements may vary, so it’s essential to inquire for more information. This program is compatible with a variety of home loans, including FHA, VA, USDA, and Conventional loans. Learn more by visiting: http://www.metrodpa.org/ or contact me for details.
- Bonus: They also have the Metro DPA Social Equity Program. This program offers down-payment assistance for individuals who are residents or the descendants of residents in specific redlined Denver neighborhoods between 1938 and 2000 for financial assistance of up to $25,000.
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Camara Real Estate, helping our clients secure a piece of Colorado.