Last Updated on August 23, 2023 by Hannah Stevens
Mortgage Assistance for Homebuyers in Connecticut
SmartMove Connecticut
The Housing Development Fund’s (HDF) SmartMove Connecticut program assists first-time homebuyers in bridging the gap between their house payment and the hefty upfront costs of closing costs and down payments. SmartMove Connecticut’s low interest loans allow homebuyers to pay only 1% of their purchase price.
Available Assistance
SmartMove Connecticut provides assistance for first-time homebuyers as a low-interest second mortgage up to 25% of the purchase cost. This can then be used for the down payment and/or closing costs.
Eligibility Requirements
The SmartMove Program is available to first-time homebuyers residing in Connecticut. HDF defines a first-time buyer as someone who hasn’t owned a home for the past three years. They must also be U.S. citizens or permanent residents, or holders of unexpired visas or work permits.
Moreover, the applicants must have a stable work history in the same field for at least two years. They must also be willing to contribute 1% towards the down payment. The down payment must be paid out of the borrower’s own money. Therefore, gift funds are not allowed, and closing costs are not part of the 1% requirement. In addition, The applicants must have at least a credit score of 660, and a maximum debt-to-income ratio of 41% in order to be deemed eligible for the program. In the event that the credit score is lower than 660, compensating factors must exist so the loan can be subjected for approval.
Property Guidelines
Homes purchased with SmartMove funds must become the borrower’s primary residence. It must also be occupied by the owner. Moreover, single-family dwellings, 2- to 4-unit dwellings, condos, or PUDs are the eligible property types. Co-ops, however, are prohibited.
City of New Haven Down Payment/Closing Costs Assistance for First Time Homebuyers
The City of New Haven provides a Down Payment and Closing Costs Assistance Program to assist first-time homebuyers in their quest to purchase their dream home. The program provides funds to help prospective homeowners avoid the renters’ traps, and get rid of the upfront costs associated with home loan loans.
Available Assistance
The City of New Haven’s Down Payment/Closing Costs Assistance Program allows first-time homebuyers to receive up to 6% of the purchase price of a single family (1-4) housing unit, or $10,000 (whichever is lower). The City offers a zero-interest loan that will be forgiven at the rate 20% per annum, then after, the loan is fully forgiven. The borrowers may also sell or transfer the property within the monitoring period time, however, the loan must be paid off. Another option is if the property is sold/transferred to someone who is prepared to assume the balance of the loan. This loan may be used for the down payment, closing costs, or both.
This programme similar to the down payment First-Time Homebuyer Assistance Programs in Colorado.
It can be daunting to buy your first home since there are numerous information to learn and steps to follow. Therefore, the Connecticut Housing Finance Authority (CHFA) created the CHFA First-Time Homebuyer Guide to help you navigate the waters. This guide walks potential homeowners through all the steps involved in buying their first home.
Connecticut Housing Finance Authority First-Time Homebuyer Guide
Available Assistance
CHFA provides a 30-year, fixed-rate mortgage at a lower interest rate for low- to moderate-income Connecticut families. They also created an 8-step guide for first-time homebuyers to help them understand the process.
This comprehensive guide covers everything you need to know about Homebuyer Education, Getting Pre-Approved for a Mortgage, Finding a Real Estate Agent and Attorney, and Finding the Right Home. It also tackles the topic of Making an Offer, Applying for a Mortgage, Home Inspections and Appraisals, and the Closing. First-time homebuyers can then make informed decisions to appease their needs. In addition, have a more pleasant experience with their mortgage process.
Fairfield First Time Homebuyer Assistance Program
Fairfield’s First Time Homebuyer Assistance Program provides financial assistance to income-eligible, first-time homebuyers to help them afford the initial costs of purchasing a home.
Eligibility Requirements
Fairfield’s First Time Homebuyer Assistance Program is only open for applicants who are first-time homebuyers. Therefore, they must not have owned a home in the last three years. They also need to have a household income that is within the established limits (listed below). All applicants must also attend and finish the HUD-certified first-time homebuyer counseling program.
Available Assistance
Fairfield’s First Time Homebuyer Assistance Program offers two types of assistance:
Down Payment Assistance: The town offers 50% of the needed down payment up to a $30,000 maximum. This no-interest loan can is for purchasing a home. However, this amount needs repayment upon sale, transfer, refinance or transfer of the property, or upon death of the owner.
Closing Costs Assistance: The town covers the closing costs up to a $2,500 maximum. These are grant funds, so there are no requirements for repayment. You can also use this money for attorney fees, appraisal costs, and/or pre-paid interest, and other financing fees.
Income Limits
- 1-person household: $55,950
- 2-person household: $63,950
- 3-person household: $71,950
- 4-person household: $79,900
- 5-person household: $86,300
- 6-person household: $92,700
- 7-person household: $99,100
- 8-person household: $105,500
CHFA Downpayment Assistance Program
The Connecticut Housing Finance Authority (CHFA), offers the Downpayment Assistance (DAP) to assist individuals in achieving their dream of owning a house. This program can help to pay for out-of-pocket costs associated with a mortgage transaction, which many first-time homebuyers cannot afford.
Available Assistance
DAP assistance funds are available in the form of a supplementary loan. Primarily, the DAP interest rate usually matches the interest rate on the borrower’s first mortgage (up to 6%). However, some borrowers may be eligible for lower interest rates under the Homeownership Program, the Home of Your Own Loan Program, the Police Homeownership Mortgage Program, and Section 8 Housing Choice Voucher Homeownership Program. Plus, borrowers may apply for a DAP loan up to $3,000.
Eligibility Requirements
Borrowers who are eligible for the CHFA first mortgage may also apply for a DAP loan up to $3,000. However, to be eligible for assistance, there are a few additional requirements. The applicant must show that they have enough income to cover both loans, but not enough savings to pay the down payment and/or closing costs on the house. In addition, applicants need to pay a $200 application fee for the program, and they must also attend a free, 3-hour homebuyer education class prior to closing the loan.
Fairfield Homeownership Assistance Program
Fairfield, Connecticut has a federally funded Homeownership Assistance Program that helps income-eligible, first-time homebuyers with closing costs and down payments on a home if they don’t have enough funds needed.
The Homeowner Assistance Program offers two forms of individual assistance:
Down Payment Assistance
Through this program, Fairfield covers 50% of the down payment cost up to $30,000 with a deferred, zero interest loan. Additionally, the loan is not due to repayment until the borrower sells, refinances, transfers the property, or passes away.
Closing Costs Assistance
These programs pay for the set closing costs related to a mortgage transaction up to $2,500. This program provides funds as a grant that don’t have to be repaid. Additionally, you can use the funds for closing costs to pay attorney fees, appraisers’ fees, and/or prepaid interests and other financing.
Eligibility Requirements
Applicants for the Fairfield Homeownership Assistance Program must be first-time buyers (those who do not have ownership interest in residential properties for the last three years). They must also attend and complete a HUD certified first-time homebuyer counseling program. Plus, the applicants must comply with the program’s annual income limits, which is based on household size and HUD limits (shown below).
Property Guidelines
The Homeownership Assistance Program is available to any property that is occupied by an owner, single-family, two-family, or condominium unit in Fairfield. This program is not designed to assist in the purchase of investment properties.
Income Limits
- 1 person household: $46,000
- 2 person household: $52,600
- 3 person household: $59,150
- 4 person household: $65,700
- 5 person household: $71,000
- 6 person household: $76,250
- 7 person household: $81,500
- 8 person household: $86,750
Hamden First-Time Homebuyer Down Payment Assistance Grant
Many people in Hamden are caught in a renter’s dilemma; they can only afford their monthly mortgage payments, but they can’t afford a down payment on a home. Hamden’s Office of Housing and Neighborhood Development offers applicants a First-Time Homebuyer Assistance Grant to help those in such a situation. Qualified applicants can receive up to $5,000 in matching funds for down payment assistance under this program.
This program is designed to provide financial assistance to qualified applicants who are interested to purchase a home, but cannot afford the upfront costs. It includes the down payment, closing costs, and prepaid items required to obtain homeownership. These costs can be significant and people might find themselves stuck in a renters’ trap if they are unable to pay them.
Property Guidelines
The Community Development Block Grant program requires applicants to purchase a home in one of three target areas: Census Tract #156 – Highwood, Census Tract #156 – Hamden Plains, or the State Street Neighborhood Revitalization Zone. The First-Time Homebuyer Down Payment Assistance grant is available for detached, single-family or two- to four-family homes. All properties must also be the primary residence of the buyer; investment properties are not eligible to get assistance.
Income Limits
To be eligible for the First-Time Homebuyer down payment assistance grant, applicants must meet the income requirements of the program.
- 1 person household: $47,600
- 2 person household: $54,400
- 3 person household: $61,200
- 4 person household: $68,000
- 5 person household: $73,450
- 6 person household: $78,900
- 7 person household: $84,350
- 8 person household: $89,800
HouseHartford Homebuyer Assistance Program
In an effort to increase homeownership in Hartford City, the HouseHartford Homebuyer Assistance Program was created. HouseHartford is a program that provides aid to homebuyers with low- and moderate-incomes with down payments assistance. It is also funded by HUD’s HOME Investment Partnerships (HOME Program).
Available Assistance
The HouseHartford Homebuyer Assistance Program offers assistance funds in the form of a second mortgage. Applicants who are income-eligible may receive as much as 20% of the total amount in down payment assistance, at a maximum of $40,000. The loan can be forgiven in 5 to 15 years, as long as the property is the applicant’s primary residence.
Eligibility Requirements
Applicants must meet certain requirements to be considered eligible for the HouseHartford Program. This program is for families with low- and moderate-incomes. Anyone earning more than 80% of Hartford’s median income (AMI) cannot be eligible for the assistance (limits are shown below). Additionally, they must contribute a minimum amount from their own resources, depending on the income they have. Those earning 50% of the AMI need to contribute at least $1,000. While those earning between 50% to 80% of the AMI must contribute $2,000.
Homebuyer Education
Before closing, applicants are required to complete an 8-hour course in homebuyer education.
Income Limits
The household income is the collective income earned by members of the household (18 years old or older) who are to live in the house, regardless of whether they have a mortgage.
- 1 person household: $52,850
- 2 person household: $60,400
- 3 person household: $67,950
- 4 person household: $75,500
- 5 person household: $81,550
- 6 person household: $87,600
- 7 person household: $93,650
- 8 person household: $99,700
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