Delaware State Housing Authority expands programs to benefit first time home owners
DELAWARE – The Delaware State Housing Authority announced Wednesday four new programs designed to increase access to homeownership in the First State. The four programs include the Smart Start Home Loan; A first mortgage loan formally known as “DSHA unassisted.” Interest rates will be priced daily and will be at or below current market rates. Program available for conventional and government loans.
“This is the cheapest way to get financing on a home, it is the best price available on that day,” said DHSA Director of Public Relations Laurie Stovall.
Another option being expanded is the Smart Start Home Loan, a first mortgage loan formally known as “DSHA unassisted.” Interest rates will be priced daily and will be at or below current market rates. Program available for conventional and government loans.
The 3rd program being launched, the Home Sweet Home Program, provides a zero-interest forgivable second loan of $12,000 to be used for the down payment and closing cost assistance for homebuyers purchasing a home with a maximum sales price of $285,000.00 or less.
The loan would be forgiven 10 percent per year for 10 years, in a move the DHSA says will help boost recurring revenue, and incentivize people to stay in Delaware, as well as help get them over the hurdle of closing costs.
“Down payment and closing costs are one of the largest barriers for potential homeowners, how are you going to get that down payment to have a sustainable monthly payment,” Stovall said.
The loan will be forgiven after 10 years with verification the homeowner(s) has resided in the subject property as their primary residence.
Also on offer, is a program aimed at bringing those in positions that are highly needed to fill hiring gaps to the first state.
The Delaware Diamonds Home Loan is a zero-interest forgivable second loan of $15,000 to be used for the down payment and closing cost assistance. This program will be eligible to current “essential workers” who live in the state of Delaware with an occupation in the following fields: education, medical, including first responders, retail such as grocery, general, and wholesale store employees, and veterans.Each year the homeowner(s) resides in the subject property as their primary residence, the loan balance will decrease by 10% up to year 10. The loan will be forgiven after 10 years with verification the homeowner(s) has resided in the subject property as their primary residence.
The final program on offer for 2023 is the First State Home Loan Program.
The program offers a zero-interest 2nd loan. Formerly known as “Preferred Plus,” it will provide a 4% down payment and closing cost assistance loan based on the 1st mortgage final loan amount. The principal will be deferred until the following events: refinance, sales, transfer of title, and the property is no longer the borrower(s) primary residence (whichever comes first).
“The announcement of these programs is an important step in our efforts to provide all Delaware residents with the opportunity to enjoy the benefits of homeownership,” said Governor John Carney. “I want to thank the Delaware State Housing Authority for their dedication and leadership in this space and encourage Delaware families to look into these opportunities.”
The Smart Start and First State Home Loan programs will be subsidized by revenues from DSHA’s primary homeownership loan programs. The Home Sweet Home Program and Delaware Diamonds Home Loan are being funded by a $5 million commitment from the additional $30 million supplement allocated by Governor Carney to DSHA.
Buyers participating in the program must meet eligibility requirements for DSHA’s homeownership loan programs, including income limits and credit score (620 minimum). Renters looking to build credit can apply for the Delaware Tenant Rent Reporting Pilot Program, which reports on-time rent payments to Equifax, Experian, and TransUnion and on-time utility payments to TransUnion.
DSHA also offers financial counseling through HUD-approved housing counselors to help potential homebuyers improve their scores and get on the path to homeownership.
In correlation with the launch of these new programs, DSHA is also adjusting the income levels for its homeownership programs to provide more opportunities for residents to purchase homes in Delaware. The new income limits can be found on DSHA’s homeownership website.
The programs are available statewide, and DSHA will be working with its participating lenders to serve homeowners. See the complete lender list here.
