Public funding is available for mortgages.
Due to recent economic conditions, the federal government has enacted laws that enable eligible homebuyers to obtain federal grants for mortgages. Some require that your income fall far below the median for the area or that the home be in a blighted area. Others have stipulations about being a first-time homebuyer. The process to apply is relatively simple for one and a little more complicated for the others.
Instructions
1. The government makes homeownership a possibility.
Find out what federal mortgage grants are available to the general public. The first-time homebuyer tax credit was extended and expanded by the Worker, Homeownership and Business Assistance Act of 2009. It now includes current homeowners who fulfill eligibility requirements. The maximum grant amount for this program is an $8,000 tax credit if your income and home price fall within program limits. The Homeownership Vouchers program is another first-time homebuyer grant. Other grants are administered by states, counties, municipalities and nonprofit groups that were awarded a portion of the ARRA to address housing issues.
2. The federal home voucher program reduces what you pay for your monthly mortgage.
Understand how federal mortgage grants work and the requirements and limitations of each. To quality for the expanded first-time homebuyer program, there are limitations for your income, cost of the home, how long it has been since you have owned a home, and current homeowners must live in their current homes for at least five of the previous eight years.
The U.S. Housing and Urban Development (HUD) department oversees the voucher program and a local Public Housing Authority (PHA) administers the program dollars. This grant also may assist with other homeownership expenses. Your minimum income cannot be less than the current federal minimum wage times 2,000 hours. For mortgage grants administered by government and nonprofit entities, you may need to fall within income guidelines or purchase a home in a blighted area.
3. Some federal grants include funding for home repairs.
Determine which federal mortgage grant best fits your situation. If you can afford a home and do not need ongoing assistance, then the first-time homebuyer tax credit may meet your needs. Your income can be at a much higher level than for other federal grants. In addition, the program runs for a set period of time, and funds are guaranteed to be available for those who are eligible. Low income is required by the voucher program. There is often a waiting list, and you are not guaranteed funding even if you are eligible since funding can run out. Grants for funding administered by government and nonprofit entities have requirements that may include income limits or buying a home in need of repair in a specific neighborhood.
4. Your state's housing authority can help you find federal grants within your state.
Apply for the grant that best meets your needs. To receive the first-time homebuyer tax credit, you must include an IRS Form 5405 with your federal taxes and submit your taxes in paper form. Electronic submissions will not be accepted for this grant. The voucher program requires that applicants go through a local Public Housing Authority (PHA). They are easily found on the HUD website. For state and other government and nonprofit grants, contact your state housing authority--e.g., California Housing Authority, Alaska Housing Authority, and so on.
Tags: first-time homebuyer, federal grants, Housing Authority, voucher program, federal mortgage
