Maryland offers several down payment assistance programs for first time home buyers. Not only does the state offer programs, but most of the different counties or towns also offer assistance programs in addition to what the state offers.
The main programs offered by the Maryland Mortgage Program (MMP) are: Down Payment Assistance and Partner Match Programs. With these programs you may qualify for assistance with your down payment or closing costs, a home inspection, or prepaid/escrow expenses. The goal of the MMP is to help those that are first-time homebuyers to purchase a home when the are not able to come up with these fees alone.
If you are eligible for a Maryland Mortgage Program mortgage you are eligible for the Down Payment Assistance Program. The loan offered by this program is a zero percent deferred loan. You can receive a loan up to $8,500. This loan will not charge you any interest and is not payable until the mortgage is paid off. If you refinance or sell you will be responsible for paying back the amount of the loan at that time.
Many first time homebuyers are also able to qualify for additional help from the Partner Match Program. Any funds you receive from this program will be matched by the MMA up to $3,500. The partners include: partner employers, builders and developers and community organizations. Most of the funds are provided by grants or loans and range between $1,000 and $5,000.
There are many local governments in Maryland that will add additional assistance to the two programs mentioned above. Some communities require you to live in certain parts of that community to qualify. Other programs are offered by your employer if you live within a certain distance from work. When trying to purchase a home be sure to check with the different local governments to see what programs they offer and if you are eligible.
Maryland works very hard to assist new home buyers with their purchase of their new home. That help comes from state programs along with local and community programs. You are able to apply and possibly be helped through many different programs. Be sure to take the time to check out all the programs in your area. You may be surprised at how much assistance is available to you.
Below is a list of Maryland Down Payment Assistance Programs:
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.
Maryland Down Payment Assistance Programs
Down Payment Assistance Program This Maryland down payment program qualifying buyers can also receive Maryland down payment and closing cost assistance of up to $8,500 in the form of a 0 percent deferred loan. Maryland borrowers must pay the loan upon selling or transferring the property, or after refinancing or paying the first mortgage in full.
HomeCredit Program Mortgage Credit Certificate when combined with the Maryland Mortgage Program and Maryland down payment assistance can save a home buyer tens of thousands of dollars over the life of a home loan. The value of Marylands MCC is 25 percent of the mortgage interest paid, up to $2,000.
Homefront Program This Maryland down payment program offers active duty and military veterans an interest rate discount of 0.25 percent on a 30 year fixed rate mortgage. This Maryland down payment program can also be combined with Marylands Maryland down payment assistance.
MMP — No Down Payment Assistance (No DPA) Program This Maryland down payment program – Maryland borrowers taking advantage of the Maryland Mortgage Program can forgo the Maryland down payment assistance associated with the loan and instead get a lower interest rate through the No DPA Program. No DPA Maryland borrowers can still utilize a MCC.
Mortgage Program This Maryland down payment program Maryland borrowers can get a 30 year, fixed rate mortgage. First time home buyers and those who have not owned a home in the previous three years are eligible. Repeat buyers are eligible if they buy a home in a targeted area. These first mortgages can be combined with Maryland down payment assistance.
Partner Match Program This Maryland down payment program – Maryland has joined forces with employers, developers and community organizations to offer partner match programs that can help home buyers cover Maryland down payment and closing costs. Partner match programs generally involve contributions of between $1,000 and $5,000 in the form of grants or loans from a partner organization. The Maryland Mortgage Program then matches these amounts up to $3,500 in the form of a zero interest deferred loan. Multiple partner matches may be combined, and these matches also may be combined with other Maryland down payment assistance loans.
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.
Maryland Housing Agencies
Maryland 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.
- Housing Commission of Anne Arundel County
- Housing Authority of Washington County
- Housing Authority of Baltimore City
- Prince George’s County Dept of Housing
- Housing Authority of the City of Cumberland
- Maryland Housing Authority
- Housing Authority of Annapolis
- Housing Authority of the City of Hagerstown
- Montgomery County Housing Opportunities Commission
- Maryland Department of Housing and Community Development