What is the Pennsylvania HOMEstead Program?
The Pennsylvania HOMEstead Program provides down payment and closing cost assistance to eligible first-time homebuyers through a forgivable second mortgage.
Who qualifies for the HOMEstead Program?
Eligibility is open to first-time homebuyers or those who have not owned a home in the past three years. Buyers must meet income, credit, and property requirements and plan to use the home as their primary residence.
How much assistance does the HOMEstead Program provide?
The program provides up to $10,000 in down payment and closing cost assistance, depending on the buyer’s needs and eligibility.
Is the assistance provided as a loan or a grant?
The assistance is a forgivable second mortgage, which is forgiven at a rate of 20% per year over five years, provided the homeowner meets program requirements and remains in the home.
What is the minimum credit score required for the program?
A minimum credit score of 660 is typically required, though higher scores may improve eligibility and loan terms.
Are there income limits for the HOMEstead Program?
Yes, income limits apply and vary based on household size and property location. These limits are updated annually to reflect current market conditions.
What types of properties are eligible for the HOMEstead Program?
Eligible properties include single-family homes, townhouses, and condominiums. Manufactured homes may also qualify if they meet program requirements and are permanently affixed to a foundation.
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Get Started NowCan the HOMEstead Program be used for newly constructed homes?
Yes, newly built homes are eligible as long as they meet the program’s guidelines and will be used as the buyer’s primary residence.
Is homebuyer education required for the HOMEstead Program?
Yes, completing a homebuyer education course is mandatory to ensure buyers are prepared for the financial responsibilities of homeownership.
What is the maximum purchase price allowed under the program?
The maximum purchase price is determined based on the property’s location and whether it is in a targeted or non-targeted area, typically ranging up to $400,000.
Can the HOMEstead Program be combined with other assistance programs?
Yes, the program can be combined with other Pennsylvania Housing Finance Agency (PHFA) programs, such as the Keystone Home Loan Program, for additional financial support.
Are there debt-to-income (DTI) ratio limits for the program?
Yes, the program generally allows a maximum DTI ratio of 45%, though exceptions may apply based on other financial qualifications.
What happens if I sell or refinance my home before the assistance is fully forgiven?
If you sell or refinance before the five-year forgiveness period is complete, you may need to repay the remaining unforgiven portion of the assistance loan.
Can the program be used to refinance an existing home?
No, the HOMEstead Program is specifically designed for purchasing a primary residence and does not apply to refinancing.
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Get Started NowAre there reserve requirements for the program?
No specific reserve requirements are mandated, but having financial reserves may strengthen an applicant’s overall loan profile.
Are there location restrictions for the program?
Yes, the property must be located in Pennsylvania, and additional guidelines may apply depending on whether the home is in a targeted or non-targeted area.
What are the benefits of the HOMEstead Program?
The program provides forgivable down payment assistance, making homeownership more affordable for eligible buyers while reducing upfront costs.
How do I apply for the HOMEstead Program?
Applicants must meet eligibility requirements and work with a program-approved lender who will guide them through the application process.
What is the loan term for the assistance provided by the HOMEstead Program?
The assistance is structured as a five-year forgivable loan, with 20% of the balance forgiven annually, provided all program conditions are met.
Can veterans benefit from the program?
Yes, veterans may qualify for additional benefits and are exempt from the first-time homebuyer requirement under certain circumstances.