Down Payment Assistance

Program Description:

The Homeownership Down Payment and Closing Cost Assistance program (DPA) provides flexible gap financing for first-time homebuyers at or below 80 percent of the area median income (AMI) to purchase homes that are safe, decent and accessible. The down payment assistance is provided in the form of a grant with a mandatory “affordability period” for the applicant to continue to occupy the house as their primary residence. An income eligible homebuyer may receive up to 10 percent or 15 percent (within the established approved areas by DHCD) of the sales price, plus up to $2,500 to pay for the cost of closing (e.g. attorney’s fee, title insurance, taxes as needs demand).

Homebuyers must meet all eligibility requirements: a. Qualify as a first-time Homebuyer as defined by one of the following: i. have never owned a home before; or ii. have not held primary ownership in a principle residence within the most recent three year period; b. Receive homeownership counseling from a HUD-certified agency and HUD certified Housing Counselor; c. Complete a HUD-certified Homebuyer Education Course through a Virginia Housing or NeighborWorks® certified course which can be monitored and audited by both entities; just as long as a completion certificate can be generated with the completion date and expiration date; Course can be also be online, but a completion certificate must be generated with the completion date and expiration date. d. Demonstrate that their income does not exceed 80 percent of the AMI; e. Have a median credit score of 620 or higher; and the debt-to-income ratio does not exceed 43%. f. Contribute one percent of the sales price of the home from their personal funds if the income is between 50%-80% of the AMI, and if the income is less than 50% of the AMI, they can contribute $500 towards the purchase of the home. Also, provide receipts as proof of the one percent contribution