Here is a good summary comparing & contrasting some of the home buying assistance programs in MD, DC and VA.
Virginia has a statewide program from the "Virginia Housing Development Authority". You can read about some of the VHDA loan types here. You may also be interested in the HOMEownership Down Payment Assistance Program
Here are some Loudoun County programs.
Here are some Prince William County programs.
The Homeownership Assistance Program (HAP)
Designed for low-income first time homebuyers. Provides a deferred loan up to $35,000 for down payment and closing costs. Qualifications - Income, interest rate, and property eligibility. Requirements - applicant must live or work in Prince William County for at least 6 months, attend financial counseling and homeownership training.
HomeStretch Program: Prince William County will be participating in the (VHDA)'s new Home Stretch Program. Home Stretch is a special housing finance program aimed at assisting those who work in the County to purchase their first home or to relocate to the County. (This program does not apply to persons working in the cities of Manassas or Manassas Park.) Prince William County has received an allocation of this special second trust fund program which will be used to fund closing costs and down payments to enhance the affordability of the home purchase. The Home Stretch Program provides a 30 year second mortgage up to $20,000 with no interest or payments due in the first 3 years. The elimination of the interest and payments during the first 3 years increases affordability for the borrower. Loan payments begin in fourth year at an interest rate of 5%
Manassas Housing Trust Fund, Inc. Homeownership Program Housing Program designed for low to moderate income first time homebuyers, who wish to purchase in the City of Manassas. The MHTF provides a deferred loan in the form of second deed of trust up to $ 25,000.00 for downpayment and closing costs assistance. There are educational classes required to include budgeting, homeownership and avoiding financial Trouble. The client must be income eligible, have good credit, good job stability and property must meet eligibility requirements.
As a first time homebuyer in MD, you qualify for several credits (this is current as of 2007 for Montgomery County):
The state transfer tax is lowered from 0.5% to 0.25%, and is paid by the seller
The recordation & local transfer taxes are paid by the seller *unless* there is an agreement (which there usually is) that they will be split equally among buyer & seller.
See the attached example of the page in the contract which highlights these items, along with a copy of a HUD-1 on the 2nd page showing the actual taxes being charged.
Also, we make sure the buyer gets what's called a "First time MD homebuyer affidavit" with their closing documents which they can then use to get the homestead deduction (reduced property taxes because the property is a primary residence).
Both VA & DC have similar programs for first time homebuyers. (In fact, DC's programs are great, including a "no interest" loan for low income buyers. You can read more about the DC program here.)
Washington, D.C. Programs
Washington, DC has a number of credit, closing assistance, and grant programs for current DC residents, and for first time home buyers in DC. Here's a summary:
HPAP - Closing assistance program, Not a grant: http://www.gwul.org/published/programs_and_divisions/hpap.html
DC Tax Abatement Program: http://www.federaltitle.com/homebuyers_dcabatement.aspx
The DC Tax Abatement Program provides an exemption from the DC 1.1% Recordation Tax and an allowable credit from your seller(s) of 1.1% equal to the DC Transfer Tax. Additionally, the program provides a five-year real estate tax abatement that begins October 1st following your date of closing. In order to qualify, the total gross household income must not exceed:
- $50,400 for 1 person in household
- $57,600 for 2 persons in household
- $64,800 for 3 persons in household
- $72,000 for 4 persons in household
- $77,760 for 5 persons in household
- $83,520 for 6 persons in household
- $89,280 for 7 persons in household
- $95,040 for 8 persons in household
In addition to meeting the above salary requirements, the property must be owner-occupied by a first-time homebuyer and the purchase price of the property shall not exceed $320,000.
You will be required to provide the closing agent copies of the following:
Copies of your tax returns from the last two years,
Copies of your W-2s from the last two years,
Copies of your two most recent paystubs.
For more information in this program, please contact Federal Title & Escrow Company or your Realtor.
(Qualifying Income Table Effective: 03/20/2007)
Here's what Melissa Schooler of B.F. Saul Mortgage wrote regarding MD & DC programs:
The following is a few things I came up with to add to it:
Under the Maryland programs section you can list some information about the CDA program such as: The CDA program offers 30 year, 40 year, 5/30, 7/23 and 7/33 fixed rate loan programs at competitive rates for first-time homebuyers. See www.morehouse4less.com for additional information about income restrictions and loan programs.
In the DC section list some information about the DC Bond program: The DC Bond program is a loan program that offers a below market interest rate on a 30 year fixed rate mortgage. The loan program is available for first-time homebuyers as well as repeat buyers who are purchasing in targeted areas. (see map – pink areas are targeted) This program can also be used in conjunction with HPAP.
Since HPAP will help pay for up to two points with their closing cost assistance, a buyer can take full advantage of the DC Bond program with minimal investment on their part - depending on HPAP Notice of Eligibility.
Another benefit of using HPAP (with or without the DC Bond program) is that by using the down payment assistance loan, you are lowering your loan-to-value (LTV). This, in turn, lowers or even eliminates the need to pay Private Mortgage Insurance. More details on the DC Bond program can be found at www.dcha.org/home.html .
I have the PDF file attached to this message and a picture is below:
You can contact Melissa at:
BF Saul Mortgage Company
7501 Wisconsin Avenue
Bethesda, MD 20814