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Home Buyer Down Payment and Closing Costs Assistance Program
How does it work?!
Here are some of the following terms/conditions of this loan:
- Three-year, no interest, no payment, deferred soft second mortgage, forgiven monthly at a rate of 1/36 over the term of the lien.
- The DPA second mortgage is fully forgiven after the 36th month (3-years).
- The homeowner can choose to refinance or sell their HOME PLUS first mortgage at any time, however, if a refinance or sale occurs in the first 36 months, the DPA 2nd lien would need to be paid (note amount less the number of forgiven months from closing date).
- AzIDA does not subordinate or provide exceptions to the DPA repayment terms.
- Home Plus has a home buyer education requirement that must be met by taking a course during the loan process. The course completion certificate is good for one year and must be completed prior to closing.
- Debt-to-Income Ratio and Credit Score are taken into account. (Please ask your Loan Officer what these requirements look like.)
Common Questions and Answers:
Can a buyer use DPA funds to bridge the gap when the purchase price is greater than the appraised value? Is it allowed? How would it work?
Yes. It will, however, require the buyer to contribute some of their own funds. For more info, ask your Guild Mortgage Loan Officer.
Do I have to buy from a specific list of eligible homes?
No. The Home Plus program allows home buyers to buy either new OR existing single-family, townhomes, condos, manufactured homes, and 2-unit properties throughout the state. Currently, 3-4 unit properties are not eligible.
Is mortgage insurance required?
If the new underlying first mortgage is a Fannie Mae or Freddie Mac mortgage, with less than 20% down, yes mortgage insurance is required. On the Fannie and Freddie products, the charter minimum mortgage insurance coverage is much lower than mortgage insurance coverage outside of the Home Plus program. Your lender should be able to provide you interest rate and mortgage payment (including mortgage insurance) comparisons between the Home Plus program options and a standard mortgage in which you provide the down payment and closing costs. You can then determine your best course of action.
My credit score is below the program minimum, what can I do now?
If your credit score falls below the minimum program requirements you are not currently eligible for the Home Plus program. Call us today to schedule an appointment! (928) 247-9089.
How do I apply for the HOME+PLUS Down Payment Assistance Program?
The Home Plus program does not require a direct application from the home buyer. All you have to do is select your Loan Officer of choice to see if you qualify!
Is this a big government, taxpayer funded program?
The Home Plus program is a true public / private sector partnership. We raise funds in the national capital markets and form partnerships with lending institutions to deliver the Home Plus program throughout the State. NO taxpayer funds are used for the Home Plus program.
My elderly parent lives with us and collects social security. Is this income counted against the program income limit?
The Home Plus income limit is based on “borrower” income, not “household” income. If your parent will be a borrower on the new underlying first mortgage, the income is counted. If your parent will NOT be a borrower on the new underlying first mortgage, the income is NOT counted.
Do I need to shop different HOME+PLUS approved mortgage lenders for the best interest rate?
The interest rates for the respective new underlying first mortgages are set by the Home Plus program and are the same regardless of which program-approved participating mortgage lender you use. Expertise in down payment assistance can vary by Loan Officer. Luckily, here at Guild Mortgage Yuma, we are very educated on this loan program, and are ready to help!
Why can’t my mortgage lender lock my interest rate immediately?
Great question. The Loan Officer has ten days from the interest rate lock date to finalize ALL aspects of the new underlying first mortgage. If the mortgage is not within ten days of completion, the interest rate lock should not occur. It is the lender’s responsibility to manage each stage of the Home Plus process and to communicate and coordinate with the homebuyer and Realtor accordingly.
Bill Craft
Sales Manager
NMLS 1621885
State Lic: AZ LO-0942496, CA-DBO01621885, MLO-54015VA
PHONE: (928) 366-1639
PHONE: (928) 247-9089
Ray Ochoa
Senior Loan Officer
Derek Egeberg
Branch Manager
