Saving money for a down payment is cited by the National Association of Realtors as one of the most challenging aspects of homeownership for first-time homebuyers. In Washington, DC, the combination of expensive homes and high cost of living can test even the thriftiest of savers.

To help buyers overcome this hurdle, there are a variety of Federal and DC-specific programs in place that assists low to moderate income buyers with downpayment assistance, forgivable second trusts, 0% down options, 3.5% down options, and more.

Here is what you should know about financial assistance programs for buyers in DC:

• FHA Loan

  The Federal Housing Administration insures loans (only through certified FHA lenders) for qualified buyers in Washington, DC up to a loan amount of $697,800. An FHA loan allows for a down payment as low as 3.5% of the purchase price. The minimum credit score for an FHA borrower looking to put down 3.5% is 580. Those with a credit score between 500 – 579 must put down at least 10%.

• VA Loan

  The US Department of Veterans Affairs insures loans (only through certified VA lenders) for qualified Service members, Veterans, and eligible surviving spouses. Eligible Veterans with full entitlement no longer have limits on loans over $144,000. A VA Loan allows for zero down payment and no private mortgage insurance (PMI). Length of service and duty status determines your eligibility and benefits.

• HPAP

  DC Department of Housing administers the Home Purchase Assistance Program. HPAP assistance comes in the form of a 40-year loan (up to $202,000) with payments deferred for the first 5 years and up to $4,000 in additional closing cost assistance. Eligibility is based on a sliding income scale.

• DC Opens Doors

  DC Housing Finance Agency administers the DC Opens Doors program, which offers down payment assistance up to 3.5% that is forgivable over the first 5 years of homeownership. The income cap for DC Opens Doors is $154,800 and a maximum credit score of 640. The maximum 1st trust loan amount is $647,200.

These programs can offer the assistance a buyer needs to make the leap from renting to home ownership in DC. As always, you’ll want to work with a buyer agent that has experience assisting other buyers using these programs and a trusted local lender who is qualified to underwrite mortgages using these program guidelines.

How We Can Help

Let us put our experience working with buyers at all income levels to work for you. We’ll walk you through the home buying process step by step, assist you in finding a lender, and help you vet various loan programs and financing options. Once your financing is in order, we’ll hit the ground running by helping you explore various neighborhoods and touring properties. With a solid financing plan and expert guidance, we’ll help you achieve homeownership in Washington, DC.

Give us a call at 202.270.1081, email us at anslie@thestokesgroup.com, or send us a message here to get started.

The Stokes Group is a team of dedicated professionals who have passion for the real estate business and will advocate for our clients with the utmost honesty, integrity, and confidentiality. We believe in building solid relationships with our clients and that starts by getting to know who we are. Follow us on Facebook and Instagram.