Could You Qualify for More Down Payment Help Than You Think?

When you’re saving to buy a home, it’s easy to assume you’ll need to cover the down payment, closing costs and other upfront expenses entirely on your own.

But before you decide you need to save thousands more, or put your plans on hold, it’s worth finding out what homeownership programs may be available to you.

There are more than 2,700 homeownership programs across the country that can help eligible buyers with expenses such as a down payment and closing costs. And you may have more options than you think.

Start by Seeing What Programs Are Available

Homeownership programs vary widely depending on where you’re buying and your individual circumstances. Some are available statewide, while others are offered by cities, counties, housing finance agencies, employers and other organizations.

That means one of the best places to start is simply finding out what programs exist where you want to buy.

You don’t need to know exactly which program you qualify for yet. An initial search can give you a better idea of the opportunities available and help you know what questions to ask your lender and real estate agent.

A First-Time Homebuyer, Three Programs, $61,000

Sometimes, exploring all of those options can make a significant difference.

Real estate agent Crystal Presley of Pollinator Properties regularly helps buyers explore homeownership programs as part of their home search.

In one Charlotte-area transaction, her client purchased a $314,000 home while receiving $61,000 through three different programs. That was equivalent to nearly 20% of the home’s purchase price.

Every buyer, home and program is different, and this type of result isn’t guaranteed. But the experience illustrates an important point: don’t assume you know how much cash you’ll need to buy a home until you’ve explored the resources that may be available to you.

You May Be Able to Use More Than One Program

One lesser-known feature of homeownership programs is the possibility of program layering, sometimes called program stacking.

Depending on program requirements, an eligible buyer may be able to combine more than one program in the same home purchase. For example, a statewide program might be paired with one offered by a city or county.

Programs can also provide different types of financial support. Depending on what’s available in your area, that could include grants, forgivable loans, deferred-payment loans, low- or zero-interest second mortgages, tax credits and other benefits.

Not every program can be combined, and each has its own rules. That’s one reason having a lender and real estate professional who understand these programs can be so valuable.

Don’t Assume You Make Too Much to Qualify

Think down payment programs are only for buyers with very low incomes? That’s a common misconception.

Every program has its own eligibility requirements. Those requirements can consider factors such as your income, where you’re buying, the type and price of the home, your mortgage and whether you’re a first-time homebuyer.

Some programs have generous income limits, and others have no income restrictions at all.

Presley makes a habit of checking for potential programs for every buyer she works with, regardless of income.

The takeaway? Don’t rule yourself out before you look.

Even if you think your income is too high or your circumstances won’t qualify, searching for programs can help you understand what may actually be available.

You Don’t Have to Be Ready to Buy Today

You also don’t need to wait until you’ve found a home to start exploring programs.

Looking into your options earlier in the process can help you develop a more informed homebuying plan. If you know potential programs could help with some of your upfront expenses, for example, that information could affect how much you decide you need to save.

Starting early can also give you time to prepare for program requirements. Some programs may require homebuyer education or have guidelines related to your mortgage, property or other parts of the transaction.

Even if buying a home is still months away, learning about potential resources now can help you prepare.

The Professionals You Choose Make a Difference

Finding a program is only the beginning. Actually using one can require coordinating its requirements with your mortgage and real estate transaction.

That’s why it can be helpful to work with a lender and real estate agent who have experience with down payment and homeownership programs.

When you’re choosing your homebuying team, consider asking:

• What down payment or homeownership programs are available in my area?
• How often do you work with buyers who use these programs?
• Are there programs I may qualify for based on my income, location or other circumstances?
• Can any of the programs available to me be combined?
• Are there special requirements, fees or timelines I should know about?
• How could using a program affect my mortgage options and closing?

You don’t have to become an expert on thousands of programs yourself. The right professionals can help you understand which opportunities may fit your situation and how they work with the rest of your home purchase.

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