Housing Grant Programs in Utah County: Your Path to Homeownership

Home Purchase Plus (HP+) Program – Up to $40,000 in Assistance

Overview

The Home Purchase Plus (HP+) program, offered by Provo City, is a game-changer for first-time homebuyers. This initiative provides a 0% interest, deferred-payment loan of up to $40,000 to help cover down payments and closing costs, making it easier to purchase a home in Provo.

Key Features

• Assistance Amount: Up to $40,000, calculated based on your mortgage type (e.g., 5% for conventional or 3.5% for FHA), plus closing costs, minus a required $1,000 contribution from you, capped at $40,000.
• Interest Rate: 0% – no interest accrues as long as you live in the home.
• Repayment: Deferred – no monthly payments are required. The loan is due only when you sell the home or it ceases to be your primary residence.
• Penalty: A $5,000 penalty applies if the home is sold or vacated within two years of closing.

Eligibility

• Must be a first-time homebuyer (no home ownership in the last 3 years).
• Household income must be at or below 80% of the Area Median Income (AMI), per HUD guidelines.
• Minimum mid-credit score of 650 (or 700 for the full $40,000, depending on need).
• Contribute at least $1,000 of your own funds.
• Liquid assets cannot exceed $15,000 after closing.
• Complete a Home Buyer Education Class.
• Purchase a home in Provo City (new or existing, up to $537,700 (effective 11-01-24)

Why Choose HP+?

With no monthly payments and generous assistance, HP+ is perfect for low-to-moderate-income buyers looking to settle in Provo without the burden of upfront costs.

Loan to Own (LTO) Program – Up to $40,000 in Assistance

Overview

The Loan to Own (LTO) program, administered by the Utah Valley HOME Consortium, offers first-time homebuyers in Utah County up to $40,000 in down payment and closing cost assistance. This 0% interest, deferred loan is designed to make homeownership accessible across most of Utah County.

Key Features

• Assistance Amount: Up to $40,000, determined by your mortgage type and closing costs, similar to HP+ (e.g., 5% for conventional loans, plus closing costs, capped at $40,000).
• Interest Rate: 0% – no interest as long as the home remains your primary residence.
• Repayment: Deferred – repayable only when you sell or move out. A $5,000 penalty applies if sold or vacated within two years.
• Eligible Areas: All Utah County cities except Eagle Mountain, Fairfield, Highland, and Woodland Hills (Provo has its own HP+ program).

Eligibility

• First-time homebuyer (no ownership in the past 3 years).
• Household income at or below 80% of AMI.
• Minimum mid-credit score of 650.
• Contribute at least $1,000 of your own funds.
• Liquid assets not exceeding $15,000 after closing.
• Complete a Home Buyer Education Class.
• Purchase a home (new or existing) in eligible Utah County areas, up to HUD’s price limit $537,700 (effective 11-01-24)

Why Choose LTO?

LTO offers flexibility for buyers across Utah County, providing substantial financial support with no monthly payments, ideal for those outside Provo’s city limits.

Own in Provo (OIP) Program – Up to $15,000 in Assistance

Overview

The Own in Provo (OIP) program is a targeted initiative to revitalize Provo communities by offering up to $15,000 in assistance to first-time homebuyers. While less generous than HP+, it’s a streamlined option for those seeking a smaller boost.

Key Features

• Assistance Amount: Up to $15,000 as a 0% interest, deferred-payment loan.
• Interest Rate: 0% – no interest while you occupy the home.
• Repayment: Deferred – due when the home is sold or no longer your primary residence. A penalty may apply if sold within two years (check specific terms).
• Purpose: Can be used for down payment, closing costs, or interest rate buy-downs.

Eligibility

• First-time homebuyer status required.
• Income limits between 80% - 120% of the Area Median Income purchasing a home in Provo. Minimum credit score of 650.
• Contribute at least $1,000 of your own funds.
• Liquid assets capped at $15,000 post-closing.
• Home must be in Provo City; purchase price limits apply (e.g., $537,700 (effective 11-01-24)
• Home Buyer Education Class completion required.

 

Why Choose OIP?

OIP is a great option for buyers needing moderate assistance to get started in Provo, with the same no-payment benefits as larger programs.

Comparison Table

Program	Max Assistance	Eligible Areas	Interest Rate	Repayment	Penalty (if sold < 2 years)
Home Purchase Plus	$40,000	Provo City only	0%	Deferred (due on sale/move)	$5,000
Loan to Own	$40,000	Utah County (excl. specific cities)	0%	Deferred (due on sale/move)	$5,000
Own in Provo	$15,000	Provo City only	0%	Deferred (due on sale/move)	Varies (check terms)

How to Apply

After the first mortgage has been approved with your lender, applicants can apply online at neighborly.provo.org or contact Provo City’s Community Grant Coordinator at (801) 852-6439 for assistance.

Q and A:

Q: Is income eligibility determined by the borrower’s income or total household income?

A: For Utah County Housing Grant Programs, income eligibility is determined by total household income, not just the borrower's income on the primary loan. This is a common standard in many housing assistance programs, including those administered by the Department of Housing (HUD) and other local initiatives in Utah County. Total household income includes the combined projected income of all adults over the age of 18 living in the home who contribute to its finances, such as spouses, partners, or other family members.

Q: Does the grant program have limits of the Debt to Income (DTI) Ratio of the primary loan?

A: Yes, all three Utah County grant programs limit the DTI to 35% housing expense and 45% total debt ratio with some exceptions based on the flowing chart:

 

Lowest Decision Credit Score	Maximum Qualifying Ratios %	Acceptable Compensating Factors
650 and Above	37/47	One of the following: • Verified and documented cash reserves (minimum of $1,000 and no more than $15,000); • Minimal increase in housing payment (no more than 100$ or 5%); or • Residual income (minimum of 20% of Gross Income according to RI calculator).
650 and Above	40/40	No discretionary debt
650 and Above	40/50	Two of the following: • Verified and documented cash reserves (minimum of $1,000 and no more than $15,000); • Minimal increase in housing payment (no more than 100$ or 5%); or • Residual income (minimum of 20% of Gross Income according to RI calculator

Grant program DTI limits are important to follow as the applicant must be eligible to secure a first mortgage from a private lender with either a Conventional or FHA loan. Your lender may approve the first mortgage loan with a DTI ratio up to 45.9% housing expense ratio and 49.9% total debt ratio for Conventional loans and 45.9% housing expense ratio and 56.9% total debt ratio for FHA loans. First mortgage loan approval with higher DTI ratios does mean the grant is automatically approved. The sales price of the home will need to be reduced for the DTI to fall in line with grant DTI requirements.

Q: Does the program have any residency or citizenship requirements?

A: Yes, verification that all members of the household are US Citizens or permanent residents. Acceptable Documentation includes: birth certificate, current US passport, or permanent resident card and Social Security card for each member of the household.

For more information download the official DPA brochure (English) or DPA Brochure (Spanish).