Real Estate

Can I get Down payment money?

There is a huge misnomer in the world that if you have never purchased a home before that you will get some free money to help buy a home. And if you have already purchased a home, you are out of luck. This is simply not true. Let me explain.
Down payment assistance programs were created to help low to moderate income families purchase a home of their own. If you make too much money, you will not qualify. There are two types of down payment programs referred to as —bond loans and grants. Today most of these programs do not require you to be a first time homebuyer. In addition, if you have not owned a home within the past 3 years, you are considered a first time home buyer.
Bond loans generally carry a higher interest rate than the prevailing rate. While both bond and grant programs both have income guidelines, bond loans allow you to make significantly more money and still qualify. Bond loans will usually pay the buyer’s down payment only. The buyer will need to negotiate closing costs with the seller or pay them themselves. These programs require that live in the property for a set period of time generally 5 years and you are not usually allowed to refinance or rent the property during this time. If you have your own money saved for down payment, you are generally better off using it than getting a bond loan due to the higher interest rate.
Grant programs allow you to get a loan using the prevailing interest rate. They do not increase the amount of the interest premium. These programs usually require borrowers to make less than the median income or perhaps 80% of the median income for the county. Currently, the grant program in Cleveland county allows a family of 4 to make up to $51,600 a year. This particular grant program will however pay the buyer’s closing costs, down payment and up front MI. This is a fabulous help for a home buyer. These programs generally require the buyer to have a percentage of their own money invested (1% of purchase price as of this writing in Cleveland county), a home buyer education class, and a property compliance inspection. Grant programs also require you to live in the property much like a bond loan.
If you are thinking about buying a home and would like more information on grant programs in your area or you are thinking about selling and you like to know how I can help you market your home using down payment assistance, please call me Sandi Walker 405-213-2992.

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