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Down payment assistance is not only for first homes, and other things buyers get
We keep a state by state library of homebuyer assistance programs, and the same misunderstandings come up again and again:
1. “Assistance is only for first-time buyers.” Many programs define a first-time buyer as anyone who has not owned a home in the last three years, and some programs are open to repeat buyers entirely.
2. “It is free money.” Some programs are grants. Many are second loans, sometimes forgivable over time, sometimes repaid when you sell or refinance. The difference matters.
3. “Only low incomes qualify.” Plenty of programs set income limits well above the area median, especially statewide ones.
4. “You cannot combine it with a regular loan.” Most assistance is built to layer on top of a standard FHA, VA, USDA, or conventional first mortgage.
If you work with buyers, what is the myth you end up correcting most? And if you bought with assistance, what do you wish someone had explained at the start?
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1 Reply
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A very common misconception is that down payment assistance is only for first- time buyers or those with poor credit and low incomes. It’s not at all. The range of people who can access it is actually quite wide.
Depending on the program, many of the state and local down payment assistance options will also be open to repeat homebuyers. You may find grants, forgivable second mortgages or even deferred payment assistance as options.
Down payment assistance is available with FHA, VA, USDA and conventional loans. Before you pick a program you should check the income limits, purchase price caps, credit requirements, repayment terms and occupancy rules.
Don’t let previous ownership or a higher income stop you from looking at the options. A lot of eligible buyers actually do miss out on the assistance they’re entitled to simply because they don’t know they qualify.
Finding the right combination of first mortgage finance and a down payment assistance program can open up a whole raft of doors. You shouldn’t just go for one option when there are a number of options available.
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