Down Payment Assistance Programs for First-Time Homebuyers in Wisconsin

Wisconsin is the 23rd largest city in America and the 20^th most populous city in the country. It has a nickname of the “Badger State” because of miners in the olden days who worked all day long and rested in small tents resembling badger dens. Today, Wisconsin is filled with beautiful shores (Lakes, Michigan, and Superior) and state parks like the Apostle Islands. Nature enthusiasts especially love it for its forests. They flock here from all over the US to explore the Northwoods for hiking and fishing.

The Badger State is also a dairy powerhouse, producing 600+ cheese varieties that make tourists revisit it again and again. Also, local cultural events celebrate Wisconsin’s German heritage. However, the ongoing housing crisis makes it difficult for locals to purchase a home in Wisconsin. Entry-level folks in the job market struggle to afford rent, and the state needs 200,000 more homes by 2030.

Luckily, the government is set to do something about this crisis. Legislations are underway to give locals and first-time homebuyers tax credits in terms of down payments and closing costs. Financial assistance is available in many shapes and sizes for eligible low-to-moderate-income earners in Wisconsin.

Looking for Assistance in a Specific Part of Wisconsin?

This page gives an overview of the assistance programs available to first-time homebuyers in Wisconsin. It’ll 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 Wisconsin

The sales price of an average home in Wisconsin increased by over 150% between 2012 and 2023. It was estimated to be around $283,000 when it was last calculated.

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

WHEDA Easy Close DPA

Homebuyers should look into WHEDA Easy Close DPA, a program meant for individuals who took out their first mortgage with WHEDA. This program helps homebuyers cover the cost of a down payment as a ten-year, fixed-rate mortgage. Borrowers then pay it back with monthly payments at the same interest rate as their first mortgage. Successful applicants get at least $1,000 as a loan.

Fundamentals

• Assistance type: Fixed-rate second mortgage
• Sponsor: Wisconsin Housing and Economic Development Authority (WHEDA)
• Assistance amount: 6% of the home purchase price

Eligibility requirements

• Have a credit score of at least 620 for conventional loans.
• Complete a pre-purchase homebuyer education course.
• Make the room your primary residence for a set period.
• Already have your first mortgage with WHEDA.

Downpayment Plus® Program

Another option is the Downpayment Plus® Program, which allows low- to moderate-income homebuyers to get a generous loan of $6,000. It doesn’t have to be repaid if the borrower fulfills a period of occupancy. The best thing about this program is that it is not limited to first-time homebuyers; even repeat homebuyers can leverage this grant to own another one under specific conditions.

Fundamentals

• Assistance type: Forgivable loan
• Sponsor:  Federal Home Loan Bank of Chicago (FHLBC)
• Assistance amount: $6,000 (at max)

Eligibility requirements

• The borrower must contribute at least $1,000 toward the purchase of the house.
• Income requirements depend on the size of the borrower’s family.
• It’s mandatory for the borrower to finish a pre-purchase homebuyer education course.
• The borrower must keep that house as their primary residence for 5 years.

Housing Cost Reduction Initiative

In the Housing Cost Reduction Initiative (HCRI), the residents of Milwaukee, Racine, and Waukesha stand eligible to get a generous amount as a forgivable grant (provided that the borrower has lived there for some years). Income guidelines vary between these three counties. A similar program exists in New York, too.

Fundamentals

• Assistance type: Grant
• Sponsor: Taylor County Housing Authority
• Assistance amount: $8,000

Eligibility requirements

• The household income must not exceed 80% of the median area income.
• The grant receiver must be behind on mortgage payments, rent, or utility bills.
• The house in question must pass inspections of housing quality standards.
• The homebuyer has to keep paying their housing costs after receiving assistance.

Wisconsin Down Payment Assistance Program FAQs

Here are some common questions from first-time homebuyers in Wisconsin seeking financial assistance with down payments:

1.  Are you eligible to get down payment assistance in Wisconsin?

A potential homeowner’s eligibility to receive down payment loans/grants will depend on their income, education requirements, the property type in question, credit score, and others. Generally, the receiver has to come from a low-to-moderate-income household with no record of homeownership in the past 3 years (exceptions can be made for repeat buyers in areas of economic opportunities).

2.  How much financial assistance can you receive through these programs?

Wisconsin-based down payment assistance programs can help you cover up to 6% of the purchase price of a home. In Madison, down payment assistance funds will provide up to $35,000 to eligible buyers. For first-time homebuyers in Milwaukee, a program offers grants of up to $5,000 ($7,000 for special areas).

3.  What steps should you take to apply for down payment assistance?

First-time homebuyers should check eligibility requirements and gather the necessary paperwork when they’re about to apply for down payment assistance. Also, it’s important to get in touch with guides like Stairs Financial to better understand your chances of receiving assistance with the down payment.

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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