Homefirst Down Payment Assistance Program: Buying a home is a major milestone, but for many, saving for a down payment can be a challenge. The HomeFirst Down Payment Assistance Program helps first-time homebuyers overcome this hurdle by providing financial support. If you’re looking to buy a home but are struggling to afford the upfront costs, this guide will help you understand how HomeFirst can help.
The HomeFirst Down Payment Assistance Program, administered by the New York City Department of Housing Preservation and Development (HPD), offers financial support to first-time homebuyers looking to purchase a property in all five boroughs. Qualified applicants can receive up to $100,000 to help with the down payment or closing costs associated with homeownership.
What is the HomeFirst Down Payment Assistance Program?
HomeFirst is a government-backed initiative designed to help first-time homebuyers acquire a home by offering financial assistance for down payment and closing costs. Its goal is to increase homeownership opportunities for low- and moderate-income individuals and families.
Who qualifies for HomeFirst assistance? To qualify, applicants must meet specific financial and residency requirements. This includes income limits, a minimum credit score, and first-time homebuyers. The program is typically available to homebuyers in areas designated to promote community development.
How much assistance can you get?
The amount of assistance varies depending on the applicant’s location and circumstances. Generally, eligible homebuyers can receive up to $40,000 in assistance, which can be used for down payment and closing costs.
How to Apply for HomeFirst Assistance
Applying for HomeFirst assistance requires completing a few key steps:
Attend a homebuyer education course
A required course helps buyers understand the process and responsibilities of homeownership.
Submit an application
Applicants must provide financial documents, credit history, and proof of eligibility.
Get pre-approval
Pre-approval from an approved lender confirms your eligibility for assistance.
Find a home
The program applies only to eligible properties.
Close on your home
Once approved, the funds are applied to your purchase.
Eligibility Requirements
Program Eligibility
A prospective homebuyer must:
- Be a first-time homebuyer
- Complete a homebuyer education course taught by an HPD-approved counseling agency
- Work with an HPD approved Housing Counseling Agency to complete a 2024 HomeFirst Loan Application (Required documentation can be found here).
- Have their own savings to contribute to the down payment or closing costs
- Meet program income eligibility requirements
- Make a minimum down payment of 3% of the purchase price towards the home purchase.
- Purchase a 1-4 unit family home, a condominium, or a cooperative for owner-occupancy in one of the five boroughs of New York City
- Pass a Housing Quality Standards (HQS) inspection before purchase
- Live in the home for at least:
- 10 years if the loan received is less than or equal to $40,000
- 15 years if the loan is greater than $40,000
- Have a maximum household income up to 80% AMI:
| Family Size | Maximum Household Income up to 80% AMI |
|---|---|
| 1 – Person Household | $87,100 |
| 2 – Person Household | $99,550 |
| 3 – Person Household | $111,950 |
| 4 – Person Household | $124,400 |
| 5 – Person Household | $134,350 |
| 6 – Person Household | $144,300 |
| 7 – Person Household | $154,250 |
| 8 – Person Household | $164,200 |
*Buyers receiving a down payment assistance loan less than or equal to $40,000 must reside in the home purchased for at least 10 years. Buyers receiving loan greater than $40,000 must reside in the home purchased at least 15 years.
Credit Qualification Requirements
Most programs require a minimum credit score of 620 to 660, but some lenders may have stricter requirements.
First-Time Homebuyer Status
Applicants generally qualify as first-time homebuyers if they have not owned a home in the past three years.
HOME Purchase Price Limits for Existing Homes
Applicant must purchase an existing home at or below 95% of the HUD purchase price limits:
| County | 1 – Unit | 2 – Unit | 3 – Unit | 4 – Unit |
|---|---|---|---|---|
| Bronx | $636,000 | $814,000 | $985,000 | $1,220,000 |
| Kings | $712,000 | $911,000 | $1,103,000 | $1,366,000 |
| New York | $636,000 | $814,000 | $985,000 | $1,220,000 |
| Queens | $684,000 | $876,000 | $1,060,000 | $1,313,000 |
| Richmond | $636,000 | $814,000 | $985,000 | $1,220,000 |
The limits above are effective as of September 1, 2024, and will remain in effect until HUD issues new limits.
Types of Housing Eligible for the Program
Eligible properties include:
- Single-family homes
- Condominiums and cooperatives
- Certain multi-family properties (up to 4 units)
Advantages of HomeFirst Assistance
- Reduces initial costs: Helps buyers purchase a home without years of savings.
- Improves loan eligibility: Some lenders may offer better mortgage terms.
- Promotes homeownership: Supports community growth and stability.
Application Process
Prospective applicants should follow these steps:
Homebuyer education
Enroll in and complete a homebuyer education course offered by a Department of Housing and Urban Development (HPD)-approved counseling agency.
Financial assessment
Work with the counseling agency to assess your financial readiness and determine eligibility based on your income and savings.
Loan application
With the assistance of the counseling agency, complete the HomeFirst loan application, ensuring you provide all required documentation.
Property Selection and Inspection
Identify a qualifying property and schedule the necessary HQS inspection to confirm it meets program standards.
Purchase Completion
After approval, proceed with your home purchase, utilizing HomeFirst Assistance for your down payment or closing costs.
Alternatives to HomeFirst Assistance
If you don’t qualify for HomeFirst, consider:
FHA Loans: Low-down payment mortgage options.
VA Loans: For eligible military members and veterans.
Local Housing Grants: Other city or state programs.
Conclusion
The HomeFirst Down Payment Assistance Program is a valuable resource for first-time homebuyers looking to overcome the financial gap that prevents them from owning a home. Understanding the eligibility criteria, application process, and benefits can help you take advantage of this opportunity and secure your dream home.
Frequently Asked Questions
- Do I have to repay HomeFirst Assistance?
Most HomeFirst funds are offered in the form of forgivable loans, meaning they don’t need to be repaid if you meet the program’s conditions.
- Can I combine HomeFirst assistance with other grants?
Yes, some buyers combine HomeFirst with other down payment assistance programs.
- What happens if I sell my home early?
Selling within a certain timeframe (usually five years) may require repaying a portion of the assistance.
- Can I apply if I already owned a home?
You may qualify if you haven’t owned a home in the past three years.
- How long does the application process take?
The process varies, but it typically takes several weeks to a few months.
Additional Resources: HomeFirst Down Payment Assistance
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