Explore Affordable Housing Options for First-Time Buyers in Delaware

The Delaware State Housing Authority (DSHA) has recently announced four new homeownership programs aimed at providing greater access to affordable housing in Delaware. Whether you’re a first-time homebuyer or looking to purchase your next home, these programs offer competitive mortgage rates and financial assistance that could make owning a home a reality.

New Programs Offering Financial Relief

Homebuyers can now take advantage of mortgage products designed to ease the financial burden of purchasing a home, with $12,000 to $15,000 available in down payment and closing cost assistance. The four new programs include:

• Smart Start Home Loan: This program offers a first mortgage loan, with interest rates priced daily at or below market rates. Available for both conventional and government loans, Smart Start is designed to make homeownership more accessible.
• Home Sweet Home Program (Temporary): A zero-interest, forgivable second loan of $12,000 for down payment and closing costs. Each year the homeowner resides in the home, 10% of the loan is forgiven, with full forgiveness after 10 years.
• Delaware Diamonds Home Loan (Temporary): A zero-interest, forgivable second loan of $15,000 for essential workers in education, healthcare, retail, first responders, and veterans. The loan works similarly to the Home Sweet Home Program, with forgiveness over 10 years.
• First State Home Loan Program: Formerly known as Preferred Plus, this zero-interest second loan provides 4% of the first mortgage amount for down payment and closing costs. Repayment is deferred until the homeowner refinances, sells, or no longer uses the home as their primary residence.

Additional Perks for First-Time Homebuyers

In addition to these programs, there are several other benefits that make Delaware an attractive option for first-time homebuyers:

1. Welcome Home Program: This program offers an unassisted first mortgage that can be combined with various second mortgage options. It’s specifically designed for first-time buyers who haven’t owned a home in the past three years.
2. Homebuyer Education Courses: DSHA provides free financial counseling through HUD-approved housing counselors. These courses help potential buyers improve their credit scores and navigate the homebuying process effectively.
3. Competitive Interest Rates: DSHA offers 30-year fixed-rate mortgages at highly competitive rates, often below market standards. This can result in substantial savings over the life of the loan.
4. Flexibility in Underwriting: The programs are designed with flexible underwriting criteria to accommodate various financial situations, making it easier for first-time buyers to qualify.
5. Income Limits Adjustments: Recent adjustments to income limits allow more residents to access these programs, expanding opportunities for homeownership across different income brackets.
6. Support for Essential Workers: The Delaware Diamonds Home Loan specifically targets essential workers. This focus not only supports those who serve the community but also helps maintain a stable workforce within Delaware.
7. Community Impact: By participating in these programs, buyers contribute to community development efforts that strengthen neighborhoods and increase overall property values.

Funding and Eligibility

The Smart Start and First State Home Loan programs are funded through DSHA’s primary homeownership loan revenues, while the temporary programs (Home Sweet Home and Delaware Diamonds) are supported by a $5 million allocation from Governor John Carney.

Buyers must meet certain eligibility requirements, including a minimum credit score of 620 and income limits based on household size and location. These new income limits can be found on the DSHA homeownership website.

Path to Homeownership

In addition to financial assistance, DSHA offers free financial counseling through HUD-approved housing counselors. These counselors work with potential homebuyers to improve credit scores and guide them through the process of purchasing a home.For more information on these new homeownership programs, including eligibility requirements and participating lenders, visit the DSHA’s official website at www.destatehousing.com.By taking advantage of these programs and resources, first-time homebuyers in Delaware can turn their dream of homeownership into reality while contributing positively to their communities.