Closing cost & down payment assistance

Posted by BJ Matson on Wednesday, July 24th, 2013 at 2:22pm.

I get asked all the time “What closing cost or down payment programs are available”?

On just about any sales price, a 20% down payment will do the trick.. along with good credit. The below programs are for those looking for low down payment options & assistance programs for closing costs and/or the down payment.

PROGRAMS

FHLB
–typically used with FHA financing, for 1st time home buyers only, this grant can be used towards your 3.5% FHA down payment requirement.
–For every $1 you put into the transaction, FHLB will match with $4 to a maximum grant of $7500.
–This allows an individual to purchase a property with as little at $1875 out of their pocket if their offer contract is negotiated with up to a 6% closing assistance credit as allowed with FHA from the seller.

CDA
–available in Maryland
–income limits vary by county
–max loan is $5,000.  Interest free, paid back over 5 years.
–additional $2,500 if you are part of the military relocation through BRAC

REACH  http://hcii.org/r-e-a-c-h/
–must be located within limits of City of Rockville
–first time homebuyers only
–household income not to exceed $98,400
–must attend seminar
–max loan is $12,000.  It is interest-free, to be paid back over 7 years.
–can be used for down payment and/or closing costs

 

FINANCING

FHA
Most people are well aware of FHA financing and this is a common low down payment option.
$300,000 as the sales price

$10,500  -minimum 3.5% down payment required
$11,000  -estimated total closing costs needed (see breakdown of Montgomery County closing costs)

$5,066    -upfront mortgage insurance, financed into your loan amount (1.75%)
$275        -monthly mortgage insurance

 

Income < $107,500
Ask me about this program if your Household income is less than $107,500.  This program is better than above FHA financing option.
$9,000    -minimum 3% down payment required
$11,000  -estimated total closing costs

$0             -upfront mortgage insurance
$0             -monthly mortgage insurance

 

Income < $86,000
Ask me about this program if your Household income is less than $86,000.  This program gets even better..
$0               -minimum 0% down payment required
$11,000    -estimated total closing costs

$0               -upfront mortgage insurance
$0               -monthly mortgage insurance

With the above 3 LOW or NO down payment programs, the seller is allowed to give a credit for the estimated closing costs amount of $11,000.
If you are able to put 5% down or more, there are some other programs out there, including the above ‘no mortgage insurance’ options if your income fits the guidelines.

BJ MatsonRealtor®
Home Buying Advisor • RE/MAX
301-881-8900 text
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Get your Montgomery County
>>Homebuyer's Guide - Programs & Benefits 

  

 

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