Find Down Payment Assistance Grants to Help You Purchase Your Next Home

• Author: Jeffrey Simmons
• Posted: 2024-10-18

It can get tough paying for your rental property every month. You are not building equity since your landlord is investing all your hard-earned income back into the property to increase its marketable value.

Out of necessity, there comes a time when it is appropriate to purchase your first starter home. As with all assets, you will need a sizable down payment to secure your financial future. Saving up for that 20% home down payment can be a little bit challenging. But the best thing is that many states offer down payment assistance so you can purchase your homestead property with ease.

Besides state agencies, get assistance with your initial down payment through local non-profit agencies. While it can be quite astounding that you can qualify for down payment assistance with just a few hurdles, the main priorities are to meet the stringent requirements for your state.

Nationwide, more than 2,500 down payment assistance programs exist across the 50 states. A few programs are loans, but the entire down payment assistance program aims to help the majority first-time homebuyers purchase their first dream homes. The following rules are a sampling of what you expect when completing your grant application:
 

• Most down payment assistance programs only help first-time homebuyers or individuals who haven't purchased homes in several years.


• Some programs offer loans instead of grants.


• Apply early as possible. Funds can go fast on a first-come-first-served basis.


• Grants cannot be used for vacation homes or investment properties.


• There is a limit on the amount of federal and state aid assistance that is available to you.


• You should be able to afford your mortgage payments without any future assistance.

If you can comfortably meet the above criteria, here is a list of grants from several states that you may want to consider or learn about home buying assistance programs here
 

Arkansas

The Arkansas Development Finance Authority has two different down payment assistant programs to help you obtain that first home. Consider the Move-Up Choice program. Get up to 4% of the mortgage opening balance to help you with the down payment or closing costs.

If this is not what you are looking for, consider the ADFA down payment assistance program that offers between $1,000 and $6,000. With this option, you agree to the second mortgage to give you ample time to repay the money over ten years. Income limitations apply to each county resident.
 

California

CalHFA or the California Housing Finance Agency offers up to 3.5% for down payment assistance for first-time homebuyers. A first-time homebuyer is a resident who hasn't purchased a home in the last three years. The reward acts as the second mortgage in conjunction with income limitations. Teachers can also qualify for special down payment assistance grants with the Extra Credit Teacher Home Purchase Program.
 

Florida

Check your eligibility for the 3% HFA Preferred Grant through the Florida Housing Finance Corporation. You can get up to 3% of the home purchase price with a down payment assistance grant that you will not have to repay.

The Florida Assist program gives homebuyers $7,500 in interest-free loans. Homebuyers take out a second mortgage. You don't make any payments on the loan unless you sell or refinance your home.

If by chance you fall upon hard times and your home gets struck by a hurricane, investigate the Hardest Hit Fund. Get up to $15,000 interest-free for five years. Twenty percent of the loan is forgiven every year. Thereby, if you stay in the property for at least five years, the entire loan amount will be forgiven.
 

Texas

The My First Texas Homebuyer program assists homebuyers who haven't purchased a home in three years. Receive down payment assistance up to 5% of the home loan amount. However, there are income requirements and purchase caps for the properties that will vary county by county.
 

Virginia

Homebuyers who have minimum credit scores that fall between 620 and 660 will meet the basic eligibility requirements for the Virginia Housing Development Authority down payment assistance grant. This grant is non-repayable. Get up to 2.5% of the home purchase price for your down payment assistance. Income limits apply.

Many funding opportunities come with loans that won't have to be repaid if you stay in residence for the required amount of time. To review other states, check with your local HUD office, housing finance authority, or state website for additional details about future home buying opportunities.

Learn more about home buying assistance programs here