Conventional Lender Paid DPA Program

The Conventional Down Payment Assistance Program Empowers borrowers to purchase a home with the incredible option of putting down only 1% on homes with a purchase price less than or equal to $350,000 or $7,000 in down payment assistance for homes with a sales price over $350,000 up to the maximum conforming loan limit. This fantastic opportunity is available for borrowers that qualify for Freddie Mac’s Home Possible loan or Fannie Mae’s HomeReady mortgage with qualified Area Median Income (AMI) of 80% or less.

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Borrower and Property Eligibility:

  • Income Limits – Qualifying income for the loan is restricted to 80% or less of area Median Income published online on Area Median Income & Property Eligibility Lookup Tool. Program does not evaluate total household income, only the income used to qualify for the loan.
  • Down Payment – The Home Possible and HomeReady Programs require a down payment of 3%.
  • Down Payment Assistance Grant – Lender Funded Down Payment Grant is capped at the lesser of 2% or $7,000. 2% for homes with a sale price of $350,000 or less and $7,000 for homes with a sales price over $350,000 up to conforming loan limits. (see examples below)
  • Grant Re-payment – Borrowers have no repayment obligation for the DPA grant.
  • Homebuyer Counseling – No requirement to be a first-time homebuyer. However, if all borrowers are first-time homebuyers (defined as no property ownership in the last 3 years) then home buyer counseling is required.
  • Minimum Credit Score – 620
  • Non-Occupant Co-Borrowers – Not permitted.

Example Scenarios:

Example 1 - Home in Salt Lake County with a purchase price of $325,000

  • Qualifying income cap is $97,200
  • 3% down of $325,000 is $9,750
  • Lender paid down payment assistance grant will be 2% of $325,000 or $6,500.
  • Borrower’s portion of the down payment is 1% of $325,000 or $3,250

Example 2 – Home in Salt Lake County with a purchase price of $350,000

  • Qualifying income cap is $97,200
  • 3% down of $350,000 is $10,500
  • Lender paid down payment assistance grant will be 2% of $350,000 or $7,000.
  • Borrower’s portion of the down payment is 1% of $350,000 or $3,500

Example 3 – Home in Salt Lake County with a purchase price of $500,000

  • Qualifying income cap is $97,200
  • 3% down of $500,000 is $15,000
  • Lender paid down payment assistance grant will be $7,000 since 2% of $500,000 is $10,000 and the amount is over the maximum amount of $7,000
  • The borrower’s portion of the down payment is $15,000 (3% of $500,000) minus the $7,000 grant, which equals $8,000.

 

Ready to take advantage of this down payment assistance opportunity? Apply Online Now or contact Steve directly at (801) 913-6502 to schedule a free consultation to see if you qualify.

 

Program terms and availability are subject to change. Eligibility is based on Freddie Mac Home Possible or Fannie Mae HomeReady guidelines, including income and credit requirements. Contact us for full details and to verify eligibility.

Contact Steve Jones - First Class Home Mortgage to assess whether a Conventional Lender Paid DPA Program is the right fit for your financial situation.