There are a number of ways to obtain help in financing your home. By taking advantage of all of the financial assistance that you qualify for, you may be eligible for a mortgage that is higher than typical guidelines dictate. Examples of resources that others have used for down payments, closing costs, renovations, and repairs are mentioned below.

Once you have decided to buy a home, you will probably work with a private lender (a bank or mortgage company) or housing finance agency to obtain your primary loan. Down payment and closing costs may be secured through loans and grants from a variety of funding sources. In Chapter Two, you will learn that researching and applying for mortgage assistance is part of the team effort. You may wish to consult with a home-buying counselor, available in most areas, and you may request other people help you access the necessary funds to purchase your home and obtain the personal assistance you need. Examples of funds people have used for down payment and closing costs are listed below.

Depending on your situation, you may need to secure additional funds for structure and property changes so that you can live safely and comfortably in your new house. Homeowners have obtained low interest loans from state housing finance agencies, private lenders, and through FHA 203K and FHA Title 1 funds. Borrowers have worked with Community Action Agencies (CAPs) to obtain grant moneys for renovations. In addition, state vocational rehabilitation programs sometimes offer grants, and construction apprentices have donated labor for repairs and renovations.

The Center for Universal Design is a national center which evaluates, designs, and promotes accessible design in buildings. The Center makes a number of publications and educational materials available, and provides information and technical assistance to people with disabilities nationwide. For more information, contact the Center for Universal Design at 1-800-647-6777.

The following is a list of possible resources for assistance in purchasing a home. This list may not include all available options. You may wish to explore various avenues in your community, as well as look at all available state and federal programs.

Three ways that down payments, closing costs, repairs, and renovations can be financed through subsidies include:

Subsidized second mortgages offer several features that can help make a home affordable. Payment on this type of loan is often deferred (delayed). These loans may carry no or very low interest rates, and part of the debt may be forgiven for each year that you remain in the home. Also, you may use a portion of the loan to pay for closing or rehabilitation costs that are not included in the sale price of the home.

These loans can sometimes be obtained through state housing finance agencies, HUD, and Federal Home Loan banks. They are called second mortgages because they are secured by a subordinate lien on your home.

Grants generally do not need to be repaid and may come from sources such as: state housing finance agencies; state and local affordable housing programs; state developmental disabilities agencies; endowments for first-time home buyers; community block grant funds; state and local social service agencies; private foundations; and contributions from the seller.

Parents or other family members who wish to be helpful may give the home buyer a gift. The gift may be in the form of cash or a trust, which will be discussed later. Some employers offer programs which pay a portion of their employees’ down payment or closing costs.