If you’re a first-time home buyer, you probably don’t have a ton of cash—just a burning desire to own your own home. So, what can you do? Check out VHDA!
A self-supporting agency, it receives no state taxpayer dollars to fund the program. Instead, money is raised in capital markets. Significant portions of net revenue are contributed each year to meet Virginia’s most difficult needs.
But who qualifies for a VHDA loan? If you’re a first-time home buyer or haven’t bought and lived in a home in the last three years, talk to a Virginia Housing approved mortgage lender. In the meantime, you can get pre-qualified here.
This article also gives a general outline of Virginia Housing’s very valuable program.
General Loan Qualifying Information: How It Work
There are maximum income limits based on the area, the household size, and product usage. The sales price and the total loan amount can’t exceed Virginia Housing loan limits.
Government Loan Programs Through Virginia Housin
Here’s a quick look at their mortgage loan programs.
Federal Housing Authority (FHA)-This is an FHA-insured loan offering a maximum down payment of 3.5% and as low as 1% with its Down Payment Assistance Grant.
With liberal credit qualifying, credit scores can be as low as 620. Monthly payments are affordable.
USDA Rural Housing Service—This program offers 100% financing for eligible rural properties, as well as low mortgage insurance. It is USDA-guaranteed. Credit scores can be as low as 620.
Veterans Administration (VA)--VA-guaranteed, this program is eligible for Virginia Housing’s Closing Cost Assistance program. For eligible veterans, there is 100% financing available. Credit scores can be as low as 620.
Virginia Housing Conventional—This 30-year fixed rate loan has the lowest conventional mortgage insurance payments available.
Available to both first-time and repeat homebuyers, less upfront cash is required at closing than with an FHA loan. Flexible payment sources are allowed such as gifts, Virginia Housing’s Down Payment Assistance Grant, and its Plus Second Mortgage program.
Those who qualify for this loan may also be eligible for a Mortgage Credit Certificate (MCC). And that brings us to Virginia Housing’s specialty programs, including MCC.
Payment Assistance Program
The maximum grant ranges between 2%-2.5% of the purchase price. It all depends on the type of Virginia Housing mortgage loan you have. What’s more, because it’s a grant, you are not required to pay it back.
Borrowers who receive this grant are also eligible for a Virginia Housing Mortgage Credit Certificate, or MCC. This is a dollar-to-dollar credit that goes toward your federal income tax liability. See more info on this below.
To see if you qualify for the Down Payment Assistance Grant, contact a Virginia Housing approved lender. Find a lender here.
Closing Cost Assistance Grant
The maximum grant is 2% of the purchase price of the dwelling. And, because it’s a grant, the borrower does not have to pay the money back.
Borrowers who qualify for this program may also qualify for the Mortgage Credit Certificate.
Virginia Housing Mortgage Credit Certificate
MCC is effective for the life of the loan as long as requirements are met, and the loan is not refinanced.
Additionally, there may be no charge for this program if an MCC is issued with a Virginia Housing first mortgage loan. You can ask your lender if there are applicable charges. You can also go here to get more information about this program.
Take the guesswork out of who qualifies for a VHDA loan. Use the resources here to find out for sure whether you’re eligible.
And when you’re ready to close on your new home, turn to the pros at Lilly Title and Settlement in Staunton, VA. We offer both title insurance and closing services for real estate loans.