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Down Payment Assistance

Understanding Down Payment Assistance Programs in Florida

Dive in to uncover how Florida's diverse down payment assistance programs can catapult your dream of homeownership from mere aspiration to exciting reality!
A young couple joyously celebrating in front of their new, beautiful single-family home with down payment assistance in Florida

Are you a First Time Homebuyer looking to buy a home?

Embarking on the journey of homeownership is exciting, but the financial intricacies can sometimes feel overwhelming. Luckily, there are organizations like Hometown Lenders, that aim to simplify the process and help you navigate your way to your first home. A trusted mortgage brokerage firm, Hometown Lenders, leverages top-notch technology and unparalleled customer service to guide you through your mortgage process seamlessly. Our primary focus has always been you, the customer, and we’re committed to doing business the right way. Now, let’s delve into a comprehensive look at down payment assistance programs in the state of Florida, which could provide a significant financial boost to your home buying journey.

The Florida Assist Bond

The Florida Assist Bond offers a second mortgage, the FL Assist, which provides $10,000 for all loans. This loan is non-amortizing and deferred, meaning it carries no monthly payment. However, it’s important to note that repayment isn’t forgivable and will become due when the property is sold, transferred, refinanced, or if the mortgagor stops living in the property. The Florida Assist can’t be combined with other FL Housing’s down payment assistance programs.

Bond First Mortgage Options

Florida Housing provides a couple of first mortgage options for eligible first-time home buyers. The first is the Florida First (FL First), a 30-year, fixed-rate mortgage for FHA and USDA-RD loans, with the rate determined by FL Housing. There’s also the FL HFA Preferred, which offers eligible borrowers a 30-year, fixed-rate mortgage and reduced mortgage insurance premiums for borrowers with income at or below 80% of AMI.

Understanding the Veterans Exception

Veterans, who’ve served in active military, naval, or air service and honorably discharged, aren’t required to be first-time home buyers to qualify for these programs. To qualify under the Veterans Exception, borrowers must certify that they meet the requirements on the Mortgagor Affidavit and provide a valid DD214.

Exploring The Florida Homeownership Loan Program 

The Florida Homeownership Loan Program Second Mortgage (FL HLP) offers $10,000 as a fully-amortizing, second mortgage with a 15-year term. This loan carries a monthly payment, but similar to the Florida Assist, the unpaid balance becomes payable in full under certain conditions such as sale, transfer, or refinancing of the property.

Taking Advantage of Forgivable Second Mortgage Option

Florida Housing also provides a forgivable second mortgage option, which offers assistance calculated as a percentage (3%, 4% or 5%) of the total loan amount. This five-year, deferred loan carries no monthly payment and is forgiven at a rate of 20% per year on the anniversary of loan closing, over the term of the second mortgage loan.

Spotlight on Florida Hometown Heroes 

The FL Hometown Heroes program presents additional benefits, such as lower first mortgage rates, and a generous down payment and closing cost assistance. It offers a 5% second mortgage – 5% of the total loan amount capped at $35,000 – in down payment and closing cost assistance as a 0%, non-amortizing, 30-year, repayable second mortgage.

Exploring Hometown Heroes First Mortgage Options

Florida Housing offers government and conventional loan options to eligible participants in the Florida Hometown Heroes Loan Program. These options include the Florida First Heroes, the HFA Preferred Heroes, and the FL HFA Advantage Heroes – all designed to aid borrowers with affordable, 30-year, fixed-rate mortgages and automatic qualification for down payment assistance.

Common Questions About Florida Down Payment Assistance for First-time Buyers

What is the biggest negative when using down payment assistance?

The biggest negative when using down payment assistance is that it often involves a higher interest rate or additional fees on your FHA loan or first mortgage loan, effectively increasing the long-term cost of your home. Also, some programs may require you to repay the assistance if you sell the house before a certain period.

Who qualifies for down payment assistance in Florida?

To qualify for down payment assistance in Florida, you must be a first-time homebuyer or a qualified veteran, meet certain income and credit score requirements, and plan to use the purchased property as your primary residence. Housing finance agencies and mortgage lenders may have additional requirements as per federal housing and urban development guidelines.

What is the down payment assistance for 580 credit score in Florida?

In Florida, if you have a credit score of 580, you may qualify for the FHA mortgage program, which allows for lower down payments and can be combined with certain down payment assistance programs. However, the specific amount of down payment assistance will depend on your individual circumstances, such as income, loan amount, and the particular program rules.

What is the income limit for down payment assistance in Florida?

The income limit for down payment assistance in Florida can vary based on the program and the location of the home. Some programs may have county-specific income limits or be designed to serve low-to-moderate-income households. Always check with your mortgage lender or housing finance agency for precise information.

Which government program requires the least down payment?

The government program that requires the least down payment is the USDA Rural Development loan program, which allows for 100% financing in eligible rural areas. The VA loan program for veterans also allows for zero down payment. The FHA mortgage program, while it requires a down payment, the minimum is quite low at 3.5% for those with a credit score of 580 or higher.

Wrapping Up The Down Payment Assistance, First-time Homebuyer Program Talk

In conclusion, Florida offers a broad range of down payment assistance programs designed to help aspiring homeowners turn their dreams into reality. From the Florida Assist Bond to the Florida Homeownership Loan Program and the special provisions for our Hometown Heroes, there are numerous options that cater to diverse needs. Each program has unique advantages and is structured to ensure that homeownership is more accessible, affordable, and sustainable. While the home buying process can be complex, organizations like Hometown Lenders, are committed to simplifying the process and providing crucial support every step of the way. Navigating these programs successfully could provide significant financial relief and accelerate your journey to homeownership.

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