There are various Maine down payment assistance programs which are meant to help residents with low and moderate incomes afford to buy homes. These programs are usually operated using federal and state funds but they are primarily administered by public agencies. Beneficiaries of these programs are segregated into different categories such as fresh graduates, first time home buyers, veterans, single mothers, families whose homes have been destroyed in natural disasters, teachers and military personnel in active duty amongst others. These categories of people usually benefit from these programs because they cannot be able to raise down payments to buy homes on their own. The primary requirement of being eligible for these programs is prove that one cannot afford to buy a home without being assisted.
For residents to qualify for these down payment assistance programs, they must have incomes which are less than 80% of the areas median income. Applicants are also required to raise at least one percent of the down payment and closing cost of the home to be bought. These programs are more convenient than ordinary mortgages since the people who benefit are not required to pay in monthly basis. Instead, beneficiaries are required to repay when they change the ownership of their homes and after they are able to refinance their initial mortgages.
The applicants of the various down payment assistance programs in Maine are served using waiting lists since the demand for the assistance is high. Applicants in dire need get preference and they are usually served before people whose needs are not emergencies. For instance; people whose homes have been destroyed by natural disasters usually get served before others who might be having other types of needs. The preference in how fast applicants are served is also influenced by the applications submitted. Applications with unclear or wrong information usually takes longer to be verified since it might even require the applicants to be called to clarify some of the unclear details. This makes it paramount for applicants to fill the applications clearly and with truthful information so that they can be served faster. Therefore, people with low and moderate incomes can benefit from the various Maine down payment assistance programs provided they are eligible and applies in the appropriate ways.
Maine Down Payment Assistance Programs
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Regardless of which type of down payment program, you will first need a mortgage. Below are mortgages that require low or no down payments:
No Down Payment Mortgages – mortgages that require no down payment
USDA Rural Loan – the purpose of the Single Family Housing Direct Home Loan is to assist low- and very-low-income applicants obtain decent, safe and sanitary housing in eligible rural areas by providing payment assistance to increase an applicant’s repayment ability. There is no down payment. Payment assistance is a type of subsidy that reduces the mortgage payment for a short time. The amount of assistance is determined by the adjusted family income.
VA Home Loan – VA helps Service members, Veterans, and eligible surviving spouses become homeowners. As part of our mission to serve you, we provide a home loan guaranty benefit and other housing-related programs to help you buy, build, repair, retain, or adapt a home for your own personal occupancy. There is no down payment as long as the sales price doesn’t exceed the appraised value.
Low Down Payment Mortgages – mortgages that require up to 3.5% down payment
FHA Mortgage Loan – the purpose of the FHA Home Mortgage Loan is to provide mortgage insurance for a person to purchase or refinance a principal residence. The mortgage loan is funded by a lending institution, such as a mortgage company, bank, savings and loan association and the mortgage is insured by HUD. A down payment of just 3.5 percent is required and may consist entirely from “gift funds.” The credit score requirement is 580.
Home Possible® Advantage Mortgage – the purpose of the Home Possible® Advantage mortgage by Freddie Mac is to offer low down payments for low- to moderate-income homebuyers or buyers in high-cost or underserved communities. Down Payment can come from a variety of sources, including friends and family, employer-assistance programs and secondary financing.
The HomeReady™ Mortgage – the purpose of the HomeReady™ mortgage by Fannie Mae is to provide flexibility for applicants buy home with down payments as low as 3%, below market mortgage rates, co-borrower flexibility, additional income sources and reduced mortgage insurance costs.
More places to find assistance on down payment:
The US Department of Housing and Urban Development (HUD) offers the following programs:
The Good Neighbor Next Door Program was created by U.S. Department of Housing and Urban Development (HUD) to help law enforcement officers, pre-Kindergarten through 12th grade teachers, firefighters and emergency medical technicians buy homes. The biggest benefit of the Good Neighbor Next Door Program is the 50% discount of the home’s list price. The only catch is that the home owner must commit to live in the property for 36 months as their sole residence.
To learn more about the Good Neighbor Next Door Program, click here.
The Section 184 Indian Home Loan Guarantee Program is a mortgage for American Indian and Alaska Native families, Alaska villages, tribes, or tribally designated housing entities. In 1992 Congress created this program to help Native American Communities with homeownership.
Section 184 loans helps borrowers buy homes with a low down payment and flexible underwriting. Moreover, the loan does not need to be used only on properties on native lands. Purchase of an existing home for single-family residences. Also allowed are new construction, rehabilitation, and refinance.
To learn more about Section 184, click here.
Maine Housing Agencies
Maine housing agencies are your best resource for down payment assistance programs. Through funding from HUD, the purpose of these agencies is to ensure that affordable housing is available for everyone.