Down Payment, Closing Cost and 1st Time Homebuyers Programs Get Assistance
The costs of downpayment and settlement can overwhelm first-time homebuyers and is listed as the #1 barrier to homeownership. Let my team of professionals save you thousands $$$ by getting you connected with the right Mortgage Lenders to access these great programs.
DSELP Loans DSELP, a program of the State of Maryland, is a loan that covers settlement expenses above a borrower's minimum equity capital contribution on a first mortgage loan that is the maximum mortgage amount permitted by the mortgage loan guarantor. Up to $5,000 with a 0% interest rate. Repayment of DSELP is deferred and is due upon the earlier of maturity or prepayment of the first mortgage, or sale or transfer of the property. Home purchase must be primary residence in Baltimore City. Income Limits: 1 or 2 persons in home $91,080; 3 or more $106,260. Maximum Acquisition Costs: FHA - $360,905; Traditional - $522,363. Buyer must contribute at least 1% towards purchase. To qualify for a DSELP loan, applicants must be using a CDA Mortgage Loan Program first mortgage. Buyer must receive city-approved homeownership counseling.
AMERICAN DREAM DOWNPAYMENT INITIATIVE Starting Date: May 1, 2006 Amount of Funds Available: $1,000,000 for 2006 Maximum Assistance: $3,000 per family in closing cost and downpayment assistance. Notice: From July 4, 2006 to September 4, 2006, funding will increase to $10,000. Form of Assistance
In Baltimore City, ADDI assistance will be in the form of a forgivable loan with a five-year term. The loan will reduce by 20% a year as long as the family continues to use their house as their principal residence. If the property is sold or rented during the first five years, a portion of the funds must be repaid. Federal Regulations
Eligible families are first-time homebuyers with family incomes 80% or below the area median (see chart below). Eligible houses must be free of any flaking, peeling, or chipping paint inside and outside - and the home inspection must document no unstable paint surfaces. Home inspectors must be members of the NAHI (National Association of Home Inspectors) or ASHI (American Society of Home Inspectors). Baltimore Requirements
Housing counseling is required for this and all City homeownership incentive programs. Home inspections are required. Only Fannie Mae and Freddie Mac approved lenders are allowed. Participants are required to invest $1,000 from their personal funds in the purchase of the house.
2006 Income Limits - American Dream Downpayment Initiative
The total family income of all adult family members combined must be below the following limits:
NUMBER OF PERSONS
IN HOUSEHOLD/FAMILY | LIMIT | | 1 person | $40,800 | | 2 person | $46,600 | | 3 person | $52,450 | | 4 person | $58,250 | | 5 person | $62,900 | | 6 person | $67,550 | | 7 person | $72,250 | | 8 person | $76,900 |
contact- karl@karlwynnsellshomes.com
Baltimores Smart Commute Initiative Location is important when it comes to purchasing a home. Now, location can also give home buyers more home-buying power and less hassle when commuting. Purchase a home in the City of Baltimore and use public transit to commute, and home buyers could qualify for the added benefits of a home mortgage through the Smart CommuteTM Initiative.
The Smart Commute Initiative may be used with standard or Community Lending products. Requires down payment of only 3 percent based on purchase price of home, or a down payment of as little as $500, depending on borrower's income eligibility. Borrowers cannot own or lease more than two motor vehicles (including cars and trucks, but excluding recreational vehicles and motorcycles). As of 2006, loans cannot exceed Fannie Mae’s maximum loan limit amount of $417,000. Home buyers must occupy the property as their primary residence. For loan qualification purposes, participating lenders will add a portion of the potential transportation savings to borrowers’ qualifying income – an addition of $200 per month for one wage-earner household and $250 per month for two wage-earner households—which could increase the home-buying power of a typical purchaser of a median-priced home up to 2-3% of the sale price. Free MTA Transit Pass! Home buyers under the Smart Commute Initiative will receive 4 weekly MARC Train passes good for FREE commutes for ONE MONTH (limit one set of passes per household) on the following public transportation systems:
o MARC Train to Washington, DC
o MTA Bus
o MTA Light Rail
o MTA Metro Subway system
For more information about the Smart Commute Initiative contact karl@karlwynnsellshomes.com
State of Maryland Mortgage Program (CDA) All of Baltimore City Eligible Income Limits: 1 or 2 persons in home $91,080; 3 or more $106,260. Income limits are subject to change; please call the Office of Rehabilitation Services at 410-396-4151 to confirm income limits. Maximum Acquisition Costs: FHA - $360,905; Traditional - $522,363 Products available with 30-year term, 35-year term with first 5 years interest only:
- Zero-Point Rate: 6.25% fixed (subject to change)
- Zero-Point Rate: 6.625% with a 2% grant
- One-Point Rate: 6.00%
- Two-Point Rate: 5.75% fixed (subject to change)
- Three-Point Rate: 5.50% Products available with 40-year term:
- Zero-Point Rate: 6.375%
- Zero-Point Rate: 6.750% with a 2% grant
- One-Point Rate: 6.125%
- Two-Point Rate: 5.875%
- Three-Point Rate: 5.625% Qualify for the $5,000 DSELP 0% interest loan when using the CDA Mortgage.
Buyer must complete homeownership education with a city-approved agency prior to writing a contract. For a list of eligible agencies. Buyer does not have to be a first-time homebuyer. Get more info from the State of Maryland Website. - For more information contact: Karl Wynn- karl@karlwynnsellshomes.com
Section 8 to Homeownership Background: Subsidies traditionally applied toward rental payments are eligible to be applied towards a montly mortgage payment. For qualified section 8 voucher holding families, it is a special opportunity for homeownership. Purpose: To facilitate a transition from renting to homebuying for participants who qualify for a mortgage from a lender. Homeownership builds wealth within low and moderate-income families and strengthens neighborhoods & communities. Source of Funds: Federally funded program administered through HABC. Implemenation: The Section 8 homeownership program is a city-wide program and participants are eligible to buy homes anywhere in Baltimore City. HABC's Family Self-Sufficiency (FSS) Program supports families' efforts to improve their economic conditions and prepare for homeownership. Applicants must be in good standing with the Section 8 program and must also complete a homeownership counseling program with a city-approved agency. A minimum cash downpayment of 1% the purchase price must come directly from the purchaser. Partners: Fannie Mae, lenders, real estate agents, and housing counselors.
Contact for Information:
Ms. Rhonda Rone, HABC Homeownership Coordinator
417 E. Fayette Street, 11th floor
Baltimore, MD 21202
Phone: (410) 396-4175
Fax: (410) 396-1284
Email: Rhonda.Rone@baltimorecity.gov
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