Tennessee Offers New Financial Aid for Homeowners
In some areas of Tennessee, the effects of the recession continue to linger into 2017. In particular, residents in 55 zip codes across the state live in “hardest hit” areas. In early February, the Tennessee Housing Development Agency (THDA) announced a new down payment assistance program for people purchasing homes in the participating areas.
About the HHF-DPA Program
The Hardest Hit Fund Down Payment Assistance (HHF-DPA) program allows home buyers in each of the 55 zip codes across 30 Tennessee counties who qualify for a Great Choice Home loan to apply for financial aid. If eligible, the program will provide $15,000 for the home buyer to use toward the home’s down payment and closing expenses.
Considered a second mortgage, the state will provide the second loan with no interest and no monthly payments. The loan features a 10-year term. If you move, sell, or refinance within five years of purchase, you must repay the full $15,000. At six years, you must repay $12,000 of the loan, and the amount incrementally decreases each year thereafter. If you stay in your home for the full 10 years after purchase, the state will forgive the entire amount.
According to news reports, the program could provide assistance to approximately 4,000 prospective homebuyers in the state. The Tennessee Housing Development Agency’s executive director’s long-term goal for the program is to facilitate home ownership and stabilize property values in the hardest hit areas for the future.
Qualifying for the HHF-DPA Program
Not everyone will qualify for this unique grant program. If you are considering purchasing a home for the first time or buying a new home, you must meet the following conditions to receive the no-interest, no-monthly payments second mortgage loan:
· You must qualify for a Great Choice Home Loan first. You must demonstrate a credit score of at least 640, meet income limits based on your household size and county, and purchase a home that does not cost more than the maximum limits covered by the program.
· You must live in one of the 55 zip codes outlined in the program. The program extends to western, middle, and eastern portions of the state.
· You must complete pre-purchase and post-purchase educational classes. The program offers online and in-person classes to help home buyers meet this standard.
· You cannot build your home. New construction projects are excluded from the program. Only existing homes qualify.
Additional terms and conditions may apply. Those who are interested in learning more about the program, available listings, and eligibility requirements can reach out to a program-approved real estate agent or lender for additional support. For certain Tennessee residents, purchasing a new home just got a little easier.