Down Payment Assistance Programs for Nevada Buyers
July 6, 2020
By April Huynh
In my property management business, I often see renters willing to pay $1600 to $2500 per month to rent a house. This range of monthly payment is certainly more than enough to get them a decent home here in Las Vegas, Nevada. When asked why they are not purchasing, almost always, one of two things come up that prevent these renters from purchasing a home for themselves. One is a lack of or bad credit which takes some time to work through. (In an upcoming blog, I will address the credit situation.)
The other is that they do not have the down payment available. In this time of the pandemic, I thought I would share what plans for down payment assistance may still be available from reliable sources in our market.
Not being a loan officer myself, I rely on information provided to me from the Nevada government website and loan officers for these programs and their availability.
First, directly from Nevada’s government website, https://bit.ly/2YRa7gd, you will find the Hope Brings You Home program. This program is generous in what it offers prospective home buyers. “Southern Nevada home buyers in eligible zip codes can now take advantage of a down payment assistance program that provides a forgivable loan of 10 percent of the purchase price, up to $20,000, toward the purchase of a home,” states the https://business.nv.gov website. The italic in the previous quote is mine to alert you that it is zip code specific, so that you are aware that these are the areas the state is encouraging in.
The link below will take you to the Nevada government website map of the areas the loan is available for. (The funds for this program comes and goes, so please check to see if, at the time you are looking to purchase, whether the program is available or not.)
Here’s how the loan works as quoted directly from the website: “The first-come, first-served program will be offered until its $36 million allocation has been distributed. A minimum of 1,800 qualified home buyers will receive down payment and closing cost assistance. Once approved, the financial assistance comes in the form of a second mortgage with a zero percent interest rate and no monthly payments for a 3-year term. The loan is forgiven at the end of the 3-year term.”
For the latest information, please contact the site’s representative for availability and qualifications:
Public Information Officer
Next, there are other Down Payment Assistance Programs (DAP) for borrowers to not only use funds for their down payment but also to cover closing costs. These programs are designed to increase home ownership opportunities for low-to moderate income borrower(s).
According to Duane Irons, Branch Manager and Loan Originator at Grand Lending Group, there are several Down Payment Assistance Programs available currently. However, there is one that he considers to be especially beneficial, standing out above the others.
Named Within Reach, this DAP program is one that works best for FHA borrowers. “What I like about this DAP program is that it allows borrower(s) to purchase a home with little to no money down, and allows them to be considered up to 140% Area Median Income,” says Irons. That means that the program allows higher income borrowers to have access to the down payment assistance for their purchase. “So, if you have borrower(s) making over the 80% limit then the program with FHA will allow them to go up to 140%,” concludes Irons. (Conventional loan borrowers will be allowed up to 80% of the Area Median Income.)
The DAP amount can range from 3 up to 6% of the purchase price. In addition, seller contributions are also allowed on the closing costs. Furthermore, borrowers do not need to be first time homebuyers to qualify. However, the program does exclude non-occupant co-borrowers. (Underwriting guidelines and program restrictions apply. Terms and programs are subject to change without notice.)
Similar to the Hope program above, the DAP comes in the form of a second mortgage with no payment or interest loan that is forgiven after 60 months from the date of close. However, if the borrower sells the home or refinances before the 60 months is up, the DAP will need to be paid off. (Note the difference that this program requires two more years than the Hope program in order for it to be forgiven.)
As a broker of loans, Irons states that their company has access to other DAP’s that allow for 80% of the Area Median income so that borrowers might have a choice as to which one may fit them better.
For additional information and qualifications, please contact:
Mortgage Loan Originator/Branch Manager
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Nevada NV# 64995 Florida FL# LO65569 Hawaii HI-1869786
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California-CA-DBO1869786 Washington MLO-1869786 Texas-SML
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It’s nice to know that there are programs out there that assist people to get into their own homes. I hope this blog is helpful to those that are considering purchasing but aren’t aware that they don’t always have to have a down payment saved in order to achieve the “American dream!”