Did you know Washington State has many programs that can cover thousands of dollars of your down payment? And, many qualify right now— you just don’t know it. For many aspiring homeowners in Washington State, saving for a down payment is the biggest hurdle. However, a groundbreaking initiative—the Covenant Homeownership Program—is changing everything, by offering up to $150,000 in down payment assistance (DPA) to eligible buyers.
If you have deep roots in Washington and are part of a demographic group identified in the Covenant study which has been impacted by historical housing discrimination, this could be the key to unlocking your first home.
Read on for a breakdown of the $150,000 Covenant DPA program, who qualifies, and how it works.
What is the Covenant Homeownership Program?
Created by the Washington State Legislature, the Covenant Homeownership Program is designed to address historical housing inequities. It provides qualified homebuyers with a 0% interest second mortgage to cover down payments and closing costs, which can be as high as 20% of the home’s costs- up to $150,000.
The Best Part?
This loan assistance may be completely forgiven after 5 years, subject to restrictions, such as: if you make payments on time, and if you are under 80% AMI at the time of purchase. The loan is deferred, meaning you make no monthly payments on this assistance. It is only repaid when you sell, refinance, or pay off your primary mortgage.
Who Qualifies for the $150K Covenant DPA?
This program is specifically for first-time homebuyers who can show a historical connection to communities harmed by racially restrictive covenants in Washington State.
There has been controversy over this Down Payment Assistance Program, but they are still kicking out the assistance to those who “qualify.”
To qualify, you must meet key criteria regarding historical residency (pre-April 1968), specific demographic backgrounds, income limits (usually 120% AMI), and a first time home buyer.
Don’t worry, as long as you work with a specialist, they will be able to help you apply.
While I personally don’t personally agree with the limitations and nature of the demographic, this program is running and people are running, not walking to get their hands on this down payment assistance money while it’s here, and I can help you get it!
If you would like more information, you can use the Free Down Payment Assistance Lookup Tool. Happy House Hunting!
Debra Teal is a Realtor at Remax Exclusive, and Certified WSHFC Home Buying Educator that represents First Time Home Buyers, and Teaches the courses needed to get the certificate for Down Payment Assistance Programs.
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