Hampton Roads Cities Down Payment Assistance and First-Time Homebuyer Programs

Down payment assistance programs in Hampton Roads Cities

Down payment assistance and first time home buyer programs aim to help home buyers make a larger down payment, cover closing costs, or a combination of both. There are several types of home buyer benefits, including grants, forgivable loans, and interest rate reductions and tax credits.

A grant is similar to a scholarship for college. You apply, and if you qualify for the program (i.e. meet all the criteria and the entity still has the money), you can receive funds toward your down payment or for another upfront cost related to your home purchase. 

A down payment loan (or second mortgage loan) is a loan you acquire in order to have the funds for a down payment. Many loan types require a minimum down payment between 3% and 20%. If you don’t have this money saved (many first-time home buyers don’t) then a down payment loan is an option to help you qualify. Some loans are even forgivable if you meet certain requirements like staying in the home for a few years.

Less commonly, some programs come with lower interest rates and tax credits (e.g., mortgage credit certificates) to help lower your monthly payments.

Hampton Roads Cities

The Homebuyers Assistance Program provides down payment and closing costs for low to moderate-income families in some of the Hampton Roads cities. Eligible service areas include Chesapeake, Isle of Wight County, James City County, Gloucester, Williamsburg, York County, Poquoson, and Portsmouth.

Assistance type: Deferred Conditional Grant

Sponsor: Hampton Roads Planning District Commission (HRPDC)

Assistance amount: Assistance amount differs based on the city.

Minimum borrower contribution: 1% of the sales price.

Eligibility requirements

• Eligible applicants must fall within the annual gross household income
• Applicants must complete an in-person or online first-time homebuyer course offered through Virginia Housing.
• The property must be the homebuyer’s principal residence for a certain period.

Statewide down payment assistance programs available in Hampton Roads Cities

Virginia HOMEownership Down Payment Assistance Program

The HOMEownership Down Payment and Closing Cost Assistance Program is an initiative developed to provide flexible gap financing for first-time homebuyers looking to purchase safe, decent, and accessible homes. This program is provided in the form of grants and assists homebuyers at or below 80% of the area median income (AMI).

Assistance type: Grants

Sponsor: VA Department of Housing and Community Development (DHCD)

Assistance amount: Up to 10% or 15% of the sales price, plus about $2,500 for closing costs.

Minimum borrower contribution: 1% of the sales price for income is between 50%-80% of AMI and $500 if income is less than 50%.

Eligibility requirements

• Homebuyers must have never owned a home before or held primary ownership in a principal residence within the most recent three-year period.
• Applicants must have a median credit score of 620 or higher, and the debt-to-income ratio should not exceed 43%.
• Applicants must complete a HUD-certified counseling.

Virginia Housing Down Payment Assistance Grant

The Housing Down Payment Assistance Grant is designed to provide financial aid to help aspiring homebuyers expedite their down payment saving process. As a grant, homeowners never need to make repayment, and this assistance can be paired with other non-Virginia housing assistance.

Assistance type: Deferred Payment Loans

Sponsor: Virginia Housing

Eligibility requirements:

• Applicants must be qualified first-time homebuyers or repeat buyers purchasing in Areas of Economic Opportunity.
• Applicants must have a bond FHA/ Conventional loan from Virginia Housing.
• Applicants must have a household income within Virginia Housing’s income limits.

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.