Program aids 1st time homebuyers with down payment costs
If you’ve ever dreamed of owning your own home, but are having trouble scraping together enough money for a down payment and closing costs, a new program now being offered by the state of Connecticut may be just what you need.
The program, Time To Own, began accepting applications this week and is administered by the Connecticut Housing Finance Authority. It offers down payment assistance to low and moderate-income home buyers in the state
Here’s what you need to know about the program:
Q: Who is eligible to participate?
A: Current Connecticut residents who are first-time homebuyers and have lived here for at least three years. The program is also open to state residents who have not owned a home in the last three years.
Individuals interested in participating in the program must meet eligibility requirements to qualify for and receive a CHFA first mortgage. Participating lenders in the CHFA program will work with applicants to determine complete program eligibility requirements.
The loan is based on such eligibility requirements as the borrower’s financial needs and their ability to repay their mortgage obligations.
Q: Who should apply to participate in the program?
A: The program is targeted at first-time homebuyers, but individuals who don’t meet that qualification may also apply if they plan to
purchase in a targeted area of the state. Every year, the federal government identifies where a state’s targeted areas are.
Q: Why is where I want to buy a home so important?
A: A key component of Time to Own provides added financial assistance to individuals seeking to buy homes in higher resourced communities, where home prices are often out of reach for new home buyers. These higher resourced communities are referred to as Higher Opportunity Areas and are evaluated based on school performance, access to job opportunities, and other community resources.
If a property is in a high or very high opportunity area, the borrower may be eligible for up to $50,000 in assistance. For any other property, the loan amount may go up to $25,000.
Q: Where are these high opportunity areas?
A full map has been created and can be found at chfa.org/about-us/ ct-opportunity-map. Many of the higher opportunity areas can be found in Fairfield County, in the suburbs around Greater Hartford and the suburbs near New Haven.
Q: What are some of the other benefits of the program?
A: There is a zero percent interest rate on the down payment loan and 10 percent of that balance will be forgiven annually on the anniversary date of the loan closing. That loan is fully forgiven on the 10th anniversary of the closing.
Financing is available to cover as much 20 percent of the down payment and up to 5 percent of closing costs.
Q: Is there a minimum loan amount?
A: Yes, the minimum is $3,000.
Q: How big is the pool of money that the loans will be drawn from?
A: A total of $20 million was allocated for home buyer assistance by the State Bond Commission late last year.
Q: Where can I find more info?
You can learn more by visiting www.chfa.org/TimeToOwn or calling CHFA’s homeownership hotline at 844CT1-HOME (844-281-4663).