Down Payment Assistance Loans

Down Payment Assistance loans are run through NCHFA (North Carolina Housing Finance Agency).

Each lender who participates must be certified in their loan programs - I am.

Down payment assistance provides $15,000 dollars toward a down payment and/or closing costs.

This works by utilizing funds from NCHFA to provide a second mortgage that does not require monthly payments.

Important fact to note - there is a recapture period on the funds used as assistance if the home is sold or refinanced within a certain time period.

A little known fact is that FHA has an option for 100% financing.

This is similar to how the NCHFA down payment assistance works, except here you are paying the first and second mortgage - financing 100% of the home.

The benefit is that it is much easier to qualify for than NCHFA. It allows for lower credit scores, higher DTI ratios, as well as co-signers, but has a higher interest rate.

It's still a great way to get into a home.