Dec 5, 2022 2022-25
Down Payment Assistance Grant Program (“DPAdvantage”)
MFA has added a new down payment assistance grant program, DPAdvantage, to assist low-income first-time homebuyers in purchasing a home and help address the trending increase in median home sales prices across the state. The increasing cost to purchase a home is associated with continued limited housing supply and a rising interest rate environment. Through this program, MFA will be able to serve more first-time homebuyers whose income falls at or below 80% Area Median Income (AMI). Borrower income program eligibility will be based on MFA’s program income calculation.
In addition to the program updates that were made available on October 17, 2022 (Lender Memo 2022-22) the new DPAdvantage Grant Program (Grant) can be combined with either the HomeNow or FirstDown Down Payment Assistance Programs (DPA), if the borrower is within the required income limit range. The Grant funds are limited and may be reserved on a first come, first served basis in conjunction with the FirstHome Program. The Grant will be available with reservations/locks dated Tuesday, December 6, 2022.
DPAdvantage Grant Program Terms:
The Grant may be used to finance the minimum down payment, closing costs (including pre-paid items), and, in some cases, additional down payment on the first mortgage loan.
The Grant provides $25,000 to each eligible household. The Grant is only available to eligible borrowers that obtain a FirstHome loan through MFA.
The Grant is not required to be repaid; therefore, a Note and Mortgage will not be required to be signed and recorded.
Borrowers must use the full $25,000 grant within the purchase transaction. Excess funds must be used as additional down payment on the first mortgage if needed.
Borrowers may not receive any grant funds back at closing. Grant funds count toward the maximum amount of $35,000 allowed by MFA funding sources toward down payment and closing costs.
DPAdvantage Income and Purchase Price Limits:
The following scenarios represent how program income and purchase price limits apply.
If the Grant is only combined with a FirstHome Loan, solely or with a FirstDown DPA loan. The income and purchase price must not exceed the lesser of the income and purchase price limits set forth in Exhibit A of the HomeNow Program Policy or the FirstHome Program Policy.
If the Grant is combined with a FirstHome and a HomeNow DPA loan. Income and purchase price must not exceed the lesser of the income and purchase price limits set forth in Exhibit A of the HomeNow Program Policy or the FirstHome Program Policy.
DPAdvantage Loan Closing and Funding:
The Participating Lender will provide the funds in the sum of $25,000 to close the loan. MFA’s Contract Service Provider will reimburse the lender at the time of purchase.
The Participating Lender must submit the “Down Payment Advantage Grant Reservation/Lock Commitment” with the purchase file to get reimbursed. The Down Payment Advantage Grant Reservation/Lock Commitment will be available to print from the PowerLender Portal once the loan(s) have been reserved/locked.
We appreciate your understanding and continuing support.
Should you have questions please contact a member of the Homeownership Department at 505.843.6880.
Thank you for participating in MFA programs.