DOWN PAYMENT AND CLOSING COST LOAN PROGRAM
NHD offers the following program to provide homebuyers under its First Time Homebuyer Program with down payment and closing cost assistance.
The NHD Down Payment and
Closing Cost Loan Program
- Provides
up to $10,000 in assistance
- Offers a fixed interest rate (2.00% above that of the first loan), 20-year loan
- Income limits mirror the Maximum Income Limits for Non-Targeted Areas and the Maximum Income Limits for Targeted Areas established for the First Time Homebuyer Program
- Purchase price limits mirror the Maximum Purchase Price Limits for Non-Targeted Areas and the Maximum Purchase Price Limits for Targeted Areas established for the First Time Homebuyer Program
- Restricts assets, after closing, to $5,000 including, without limitation, cash, savings accounts, stocks, bonds and equity in real property
- Requires a homebuyer to successfully complete a First Time Homebuyer Education Course
- Application is made through Participating Lending Institution simultaneously with the application for the First Time Homebuyer Loan
Steps to Obtain a First Time Homebuyer Loan
- Prequalify for a Loan
Participating
Lending Institutions process all NHD
loans.
First, select a
Participating
Lending Institution.
Then, make an appointment with
that lender to determine your
eligibility and the purchase price of
the home for which you can qualify for
and which loan
type best meets your needs.
The
Participating Lending Institution will
also explain what fees
are involved and how much down payment
is necessary.
NHD can also provide a down-payment loan, if needed.
The
Division cannot emphasize how important
homebuyer education is for first-time
homebuyers. The Division requires the
attendance to a HUD approved in-person class
for all applicants using NHD loan
programs.
- Locate an Affordable Residence
Begin
looking for an eligible residence you
can afford based on the information the
lender provided.
Although not required, using the
services of a real estate professional
is recommended.
- Enter Into a Real Estate Purchase Contract
This
agreement is the contract used to
purchase a home.
It specifies the legal
obligations of the seller and the buyer,
establishes a specific date of purchase
and sets the price of the home.
This contract should allow enough
time for a complete home inspection, (on
an existing home), home appraisal and
loan approval.
In this agreement, it should
state that if you are not satisfied with
the home inspection, or you do not
obtain a NHD loan, the contract is
cancelled and your earnest money will be
refunded.
- Apply for a Loan
At this point you can formally apply for a NHD loan through a Participating Lending Institution. After you have applied the lender will request that NHD reserve funds for the loan. Only one application may be made per applicant and funds are reserved on a first-come, first-serve basis.
