Down Payment Assistance For Property Loans

Owning a property comes with a lot of problems. Savings for a down payment on a home remains to be the biggest obstacle for every homeowner. However, to curb this problem out, the federal government has provided more than 2000 different down payment assistance programs all across the United States, helping citizens of the US to buy a house much sooner than they ever would have anticipated. Apart from these down payment assistance programs, there are several other types of incentives that can make the home buying process easy. In a nutshell, DPA or down payment assistance helps house owners with low-interest loans or grants thereby saving them from the trouble of the initial down payment.

 

Down Payment Assistance: Whenever you plan to buy a house, you will first need to make a down payment on the home. The down payment amount is the lump of cash deposit that is equal to the overall percentage of your property’s final purchase price. When it comes to down payment, many property owners face issues. Coming up with the lump sum of cash in the very first place is often very difficult for the buyers. To help homeowners overcome this problem down payment assistance comes into play. As simple as the name sounds, through this program, you can easily cover your first home down payment. The entire down payment sum might even come from federal and state government bodies, local charities, or even individual mortgage lenders. In some rare cases, your employer or even work union might even help you with providing down payment assistance especially in those circumstances when you can’t rely upon other solutions. Most of the charity programs or government organizations have a very strict definition qualifying as first-time homebuyer. In case you haven’t owned any property in the past three years, most federal, state, or other non-profit organizations can consider you as a first-time buyer. You can even invest in some rental or investment property and can opt to get first-time property buyer down payment assistance.

Here is a list of a few down payment assistance programs that can help you as a first-time house buyer.

  • Down Payment Assistance Loans: In case you aren’t sure if you can cover the whole down payment of your property on your own, you can consider a down payment assistance loan. These loans are mostly unique, unlike other loan types you can opt for them for your home down payment. They mostly come in three major types- Deferred payments, forgiveness loans, and second mortgages.

 

  • Down Payment Assistance Grants: You might try your luck for a DPA grant to cover the whole cost of your home down payment. DPA grants or VA loans are completely different from that of DPA loans. In the case of loans, you have to repay the amount at some point in time unless and until it is a forgivable one but when it comes to down payment assistance grants you don’t need to repay them. DPA grants mostly come from the charities or local governments. These programs operate much differently from one another, but in almost all cases you will be receiving the amount in a lump sum that you can use to pay off your home down payment. While opting for DPA grants, it is always advisable to stay aware as it might come with stipulations. In case you don’t live in your property for enough years, you might need to pay a part of your award money while you sell back the property. It is always a great idea to understand all the rules and regulations of the DPA grant program before opting for it.

 

  • HUD Program: The HUD or the US Department of Housing and Urban Development, offers several state-run housing assistance programs. The HUD home buyers’ program can help a lot in finding the right loan or other grant programs. This program even helps a lot in covering the total cost of your home down payment. Before you opt for the housing and urban development program it is always advisable to learn all the requirements and follow them before signing for the papers.

 

  • Government Insured Loans: Mostly the loans that are offered by government agencies such as VA loans, FHA loans aren’t an example of down payment assistance. However, these loans usually allow their buyers with lower down payments. These government loans can be of real help especially to first-time buyers. Government-insured loans are backed by the federal government making them much less risky for the lenders. This even allows the lenders to give mortgages to those who have low credit scores and less money for a home down payment. There are a few types of government-backed loans. Each of these loan type has its own features and benefits that can be helpful to the borrower.

 

  1. VA Loans: VA loans are those home loans that can be availed by the current employees, veterans, and deceased service members of the armed forces. Before opting for a VA Loan, you will be needing several service requirements to get it approved. Much similar to a USDA loan, the VA loan helps in buying a property without any down payment.
  2. USDA Loans: The USDA loans are especially for those who wants to buy a property in a suburban or rural area. Your property must be in a place that USDA deems adequately rural in order to qualify.

In case you are thinking of buying a new property in Gilbert, Scottsdale, Phoenix, or Tempe try considering UrbanHouse Realty. The agents at UHR have years of experience and immense knowledge in all sorts of property acquisitions. No matter if you are a seasoned investor or a first-time buyer, the well-versed team at UHR has all the expertise that can cater to your purchase.