Down Payment Assistance Loans
Lenders: Help Your Customers Close the Gap on Down Payment and Closing Costs with a DPA Loan.
Our Down Payment Assistance Loan Program provides no interest loans of up to $15,000 for first-time home buyers to cover a portion of the down payment and/or closing costs associated with the purchase of their home. Help your customers increase their down payment and avoid costly private mortgage insurance.
Eligible homebuyers must:
- Be first-time homebuyers.
- Have a pre-approval and a fully executed purchase/sale agreement.
- Be purchasing in Coos, Curry, Douglas, Klamath, or Lake Counties.
- Subject Property must be a single-family home, condominium, or manufactured home; on fee-simple land or within a Community Land Trust. Manufactured homes must comply with conventional first mortgage lending standards.
- Qualify for conventional or government loan; fixed-rate or adjustable-rate loans are acceptable, no negative amortizing loans.
- Complete Home Buyer Education & Counseling.
- Intend to occupy the home as primary residence.
- Total Household Gross Income must be below 100% Area Median Income Limits (see chart below)
- Liquid Assets cannot exceed $20,000 after closing (unless more is required by lender)
- Debt to Income Ratio cannot exceed 45%
- Loan to Value Ratio cannot exceed 103%
2020 HUD Income Limits – Individual Income Limits Areas – 100% of Median Income
|County||Family Median Imcome Limit|
“Homeownership would have been impossible without NeighborWorks Umpqua! I am definitely low income and I was worried that homeownership might be out of my reach.” – J.B.
Down Payment Assistance Loan funds may be used for full or partial down payment and/or closing costs. The borrower may not receive cash back.
Veterans may use up to $15,000 in DPA funds to cover the cost or improve the down payment VA Funding Fee. Veterans must provide DD-214 documentation to establish eligibility for a higher loan amount.
The loan becomes payable in full upon sale, transfer, refinance, or when the borrower no longer occupies the home as their primary residence.
Amount – up to $10,000 for Non-Veterans; up to $15,000 for Veterans
Interest Rate – Interest-free
Monthly Payment – no monthly payment
Repayment – The loan becomes payable in full upon sale, transfer, refinance, or when the borrower no longer occupies the home as their primary residence.
Subordinations - NeighborWorks Umpqua may agree to a subordination for rate/term refinances that show a clear benefit to the borrower. We will not subordinate for a cash-out refinance.
Transfer – This loan is not assumable by another party.
How to Apply on behalf of a borrower:
- Ensure borrower meets eligibility standards described above
- Complete and submit the Loan Request Form along with required supporting documentation
- NWU will contact the borrower to discuss eligibility and initiate a loan application