North Carolina Down Payment Assistance Programs

North Carolina Down Payment Assistance Programs
North Carolina Down Payment Assistance Programs

North Carolina down payment assistance programs help first time home buyers in realizing the American dream of owning a home. These programs include the down payment assistance program and the mortgage credit certificate.

The two programs are unique in nature and aim at helping the different classes of people depending on their income levels. All the North Carolina down payment assistance programs beneficiaries are given a tax credit of $8000 per year. This is meant to spearhead the country’s economic stimulus programs which encourage people to live under good housing conditions.

First time home buyers are people who might not have owned or occupied a personal home within a period of three years or people who had previously owned a home and sold it out for a period exceeding three years. Further, the residential property which you aspire buying must be the primary residence. In order to benefit from this program, one must attend a home buyer education counseling program with a certificate indicating completion. Every down payment assistance program has requirements which vary from program to program.

North Carolina mortgage credit certificates are federal tax credit program aimed to assist the low and moderate income earners to buy their own homes. It is the second part of the North Carolina Down Payment Assistance Programs. People who fall under this particular program receive a tax reduction on their annual gross income. The gross income is the key determinant for identifying the beneficiaries. This income is summed up for everyone living in a beneficiary’s residency aging eighteen years and above. People who fall in this category are allowed a twenty percent claim on their mortgage interest rates paid per year. Saving up to $2000 on taxes.

Below is a list of North Carolina 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.

North Carolina Down Payment Assistance Programs

NC Home Advantage Mortgage Program This North Carolina down payment program is for a first time home buyer (or a move up buyer) in North Carolina has annual income under $85,000 and a credit score above 640 they will be eligible for the Home Advantage Mortgage. This first mortgage loan is paired with North Carolina down payment assistance. Current loan terms are 30 year fixed rate mortgages with zero discount points and 1 percent origination fee. The North Carolina down payment and closing costs assistance is an interest free deferred and forgivable second mortgage loan which can amount to up to 5 percent of the first mortgage amount. Repayment of the North Carolina down payment assistance is only required if a North Carolina borrower vacates the home within 15 years.

HUD Programs

The US Department of Housing and Urban Development (HUD) offers the following programs:

Good Neighbor Next Door Program

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.

Section 184 Loan – The Indian Home Loan Guarantee Program

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.

North Carolina Housing Agencies

North Carolina 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.