Amid rapidly growing homeownership costs, the District of Columbia has joined several states in announcing additional funding assistance for low-income homebuyers.
D.C. Mayor Muriel E. Bowser announced Monday that the District has more than doubled a subsidy for down payment assistance, up from $80,000 to $202,000, for qualified residents.
As part of the District's Home Purchase Assistance Program (HPAP), applicants can receive funding as interest-free loans based on a household's income, size and availability of funds. Additionally, homebuyers can qualify for $4,000 in closing cost assistance.
Rising home prices and mortgage costs in the U.S. have increasingly put homeownership out of reach for many buyers. The cost of a typical monthly bill for a single-family home with a 20% down payment has increased by 50% since last year, according to the National Association of Realtors.
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To bridge that gap, several states have also announced additional funding for down payment assistance programs:
- Earlier this month, Maryland Governor Larry Hogan boosted funding for a unique "SmartBuy" program for low- and moderate-income earners with student loan debt. It either pays off 15% of the home purchase price or $50,000 in student debt — whichever is lower. To help cover down payments and closing costs, the SmartBuy program also offers a zero-interest loan option worth up to 6% of the mortgage cost.
- In June, Connecticut Governor Ned Lamont announced the home buyer assistance program Time to Own, which offers a 10-year interest-free loan worth up to $50,000 in select areas. Eligibility is based on income and ability to pay off the mortgage. You must have been a resident of Connecticut for the past three years.
- In June, Florida announced a "Hometown Heroes" program offering zero-interest loans worth up to $25,000 for frontline community workers in more than 100 eligible professions, including child-care employees, law enforcement officers, educators, health-care professionals and active military or veterans. Eligibility is based on income and other factors.
Most states have similar down payment assistance programs for low- to moderate-income earners. Real estate site The Mortgage Reports offers a breakdown these programs, which are listed by state.
Money Report
For all other forms of homeowner financial assistance, the United States Department of Housing and Urban Development (HUD) has a list of resources and programs, listed by state. For each state's page, select "Learn About Homeownership" for more information.
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