VHDA Financing for First-Time Homebuyers: A Well Kept Secret
If you’re looking for a home loan in Virginia, going through the Virginia Housing Development Authority (VHDA) may be a good option. The organization is a not-for-profit that helps mostly first-time homebuyers obtain affordable mortgages. They may even be able to assist you with a down payment on your first home through a grant. Learn more about their financing opportunities and grant programs to see if they might be a good alternative for your home purchase.
VHDA’s Down Payment Assistance Grant
If you’re a first-time homebuyer and you qualify for this program, you may receive a percentage of your new home’s purchase price to help with the down payment. If you qualify, you do not have to pay the money back. When you receive this grant, you are eligible for a Mortgage Credit Certificate, which is a dollar-for-dollar credit against your federal income tax liability. It is important to keep in mind that there is a limited amount of grant money offered each year by the VHDA, so the sooner you contact a lender to determine if you qualify, the greater your chances to receive it!
The maximum grant the VHDA offers is 3 to 3.5 percent of the purchase price required for the eligible VHDA loan. There are income limits which you must not exceed in order to receive this grant. There are also only certain VHDA loan programs which qualify for down payment assistance. To learn more about this program, it’s best to contact a lender.
Education for Homebuyers
VHDA offers free education to help you understand the kinds of loans that are available. They will walk you through the home buying process from start to finish and show you how to stay on track once you’re in your home. You can take the class in person or online.
Eligibility for VHDA Financing
In order to qualify you must:
· Demonstrate creditworthiness
· Be a first-time homebuyer, which means that you have not had ownership in any residence in the past 3 years, unless you are purchasing in an Area of Economic Opportunity
· Intend to occupy the property (not use it as a rental property)
· Show stable income and funds for your down payment and closing costs
· Complete the VHDA’s course on Homeownership Education
· Meet the sales price limits and income guidelines
· Purchase a home on a lot no larger than 2 acres
Home Loans Offered Through VHDA
There are several different loan programs available through VHDA. All have slightly different criteria, and not all are eligible for down payment assistance, so be sure to check with your lender to see which loan is right for your situation. Here’s an overview of loan programs that are available.
· Conventional fixed – This 30-year, fixed-rate program offers you low fixed monthly payments. Conventional private mortgage insurance allows you to finance up to 97 percent of the sales price.
· FHA – This is another 30-year, fixed-rate program that requires a low down payment and is fairly easy to qualify for. It’s FHA-insured and has liberal credit qualifying.
· VA – This 30-year, fixed-rate program requires no down payment (for eligible Veterans) and offers low fixed monthly payments. It’s VA-guaranteed and has a low, fixed interest rate.
· RHS – A fourth 30-year, fixed-rate program is government insured and offers low, fixed monthly payments. This loan requires no down payment in approved rural areas.
· FHA Plus – This loan program allows you to finance your home 100 percent with two mortgages, one for the FHA-insured first mortgage and the second to fund a down payment and closing costs. Both loans are low 30-year fixed-rate.
Even with great programs, the VHDA is still one of the best kept secrets around. But the secret is out, and now you know you have another option for financing that home you’ve been dreaming of. For more information, visit www.vhda.com. To start searching for your home, contact Jacobson Realty and Home Staging. We’ll help get you set for the next chapter in your life!
Jacobson Realty and Home Staging (JRY) was established by Broker/Owner Belinda Jacobson-Loehle in April 2002. Belinda is a native Washingtonian who grew up in Alexandria, Virginia and has lived and worked in Gainesville, Virginia since 1995. She has been a licensed broker since 1989.
The JRY mission is to provide professional advice and analysis, maintain clear and consistent communication, and serve clients with respect. The home buying and selling process can be an exciting and stressful experience. Our goal is to make it smooth, educational, enjoyable, quick, and as financially beneficial as possible.
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