Down Payment Assistance Programs for First-Time Homebuyers in Maryland

Maryland has a population of 6 million people and remains the 19^th-largest state in America. Dubbed the “Old Line State,” Maryland has a unique blend of serene beaches, historical landmarks, culinary delights, and cultural events. You can roam freely on the sand in Ocean City and Assateague Island. The stunning and beautiful Chesapeake Bay makes you busy fishing and hiking. From the National Folk Festival to the very alluring Antietam National Battlefield, this city has everything for everyone.

However, urban Marylanders are increasingly leaving the Old Line State due to expensive housing. Many first-time homebuyers struggle to make down payments, and Maryland has become the toughest state in the US for renters. That’s why the government has many down payment assistance programs in place to make sure that low-to-moderate-income earners in Maryland can afford decent housing.

Looking for Assistance in a Specific Part of Maryland?

This page gives an overview of the assistance programs available to first-time homebuyers in Maryland. It will also cover statewide and local resources. For specific information on down payment assistance in your area, refer to the local resource provided here:

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Down Payment Assistance in Maryland

Since the COVID pandemic, house prices in Maryland have increased a lot. A Redfin estimate reveals that a typical home has been 5.3% pricier since last year and is selling at an incredible amount of $445,000!

However, you can use numerous down payment assistance programs to own a home in Maryland. Stairs Financial offers insights into some of these affordable housing programs. Locals use this info to choose the ideal financial assistance option. Here are some down payment assistance programs for you:

Maryland Mortgage Program 1^st Time Advantage

Marylanders can get deferred, zero-interest, second-mortgage loans by applying to this program. The Maryland Mortgage Program (MMP) 1st Time Advantage comes in many levels and helps eligible homebuyers purchase a house without the first mortgage weighing them down.

Fundamentals

• Assistance type: 30-year fixed-rate mortgage
• Sponsor: Maryland Department of Housing and Community Development (DHCD)
• Assistance amount: $6,000

Eligibility requirements

• The borrower must be a first-time homebuyer (except in Baltimore City).
• The borrower has to get a homeownership counseling certificate first.
• Getting a Maryland Mortgage Program-approved lender is mandatory.
• There must be no other properties in the borrower’s name at the time of applying.

MMP SmartBuy 3.0

Want 15% off the home purchase price with some help with student loans? That’s what MMP SmartBuy 3.0 incentives offer Marylanders. If your student loan balance is at least $1,000, you stand eligible to get these funds.

Fundamentals

• Assistance type: 30-year fixed-rate mortgage and a forgivable second loan
• Sponsor: Maryland Department of Housing and Community Development (DHCD)
• Assistance amount: $20,000 (for student debts)

Eligibility requirements

• Your student debt must be less than 15% of the home purchase price.
• Completing a homebuyer education class is mandatory for borrowers.
• You must have at least a thousand dollars remaining in your student debt balance.
• It must be your first home (unless you’re a veteran or living in target areas).

MEP Advantage Down Payment Assistance Program

Another option is the MEP Advantage Down Payment Assistance Program, a key funding source for first-time homebuyers who don’t qualify for state or local DPA grants. It can cover 100% of financing for an FHA loan and help low-to-moderate homebuyers achieve their dream of purchasing a home.

Fundamentals

• Assistance type: Zero-interest, second-lien forgivable loan
• Sponsor: Community Mortgage Group (CMG)
• Assistance amount: 3.5% of the sale price

Eligibility requirements

• The borrower must have a credit score of 600.
• One occupying homebuyer must finish an education course.
• Single-family residences (1-unit), duplexes, some manufactured homes, PUDs, townhouses, and condos fall under this program.

MMP Partner Match Programs

As per the MMP Partner Match Programs, homebuyers receive generous grants to afford a home. Under certain conditions, this program will meet dollar-for-dollar contributions from participating partners. You may also combine it with the basic MMP down payment assistance.

Fundamentals

• Assistance type: Zero-interest, deferred loan
• Sponsor: Maryland Department of Housing and Community Development (DHCD)
• Assistance amount: $2,500

Eligibility requirements

• Submitting a Verification of Partner Contribution form is a must.
• It’s important to get 1^st Time Advantage 6000, Flex 6000, or other MMP loan products.

Maryland Down Payment Assistance Program FAQs

Here are some questions from first-time homebuyers in Maryland looking for financial assistance with down payments:

1.  How do you become eligible for Maryland down payment assistance?

You can apply for down payment assistance in Maryland if you haven’t owned a property in the past 3 years or so. Similarly, homebuyers must fulfill a set credit score criterion (640, at least) and complete the recommended homebuyer education course. Also, the property purchased under these programs has to be the borrower’s primary residence for a set number of years.

2.  How much down payment assistance is available to you in Maryland?

Marylanders can leverage different financial assistance programs to make down payments on houses. In most cases, you may get fixed amounts of $5,000 to $6,000 or up to 5% of the deferred second lien. You may also get up to 15% of the purchase price ($20,000) to pay off your student loans.

3.  Do you have to repay the down payment assistance?

Most Maryland-based down payment assistance programs are deferred, 0%interest second mortgages. So, you don’t have to make any repayments on your loan until you end up paying off the first mortgage. Similarly, if you sell the home, then you’ll be asked to make repayments. Some programs have forgivable portions as well that don’t require any repayment after a certain period.

Disclaimer: This article is for informational purposes only and should not be considered as legal or financial advice. Please consult an attorney, mortgage lender, or CPA for guidance on your specific situation.

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