Mon. Aug 8th, 2022

Photo by Rachel Martin on Unsplash

With the goal of making the home buying process in New York fairer, the city is expanding its existing prepayment program by more than double. The Department of Housing Protection and Development announced Monday that it will offer up to $ 100,000 in advance payments or closing costs to first-time buyers who earn up to 80 percent of the area’s median income (AMI), a big increase from the $ 40,000 in forgiving loans previously offered by the city .

The HomeFirst Down Payment Assistance Program, first launched in 2004, addresses the shortage of affordable housing for low-income New Yorkers, especially in transit and recreational areas.

According to the city’s Where We Live NYC plan, racial differences in ownership percentages are severe, and residents in color face more obstacles when buying a house than white residents. In New York City, 28 percent of black families and 17 percent of Spanish families own their homes, against 41 percent of white families.

“This major extension of advance support is a major gain for equity and diversity as it tackles one of the biggest barriers to home ownership for low-income families and colored families,” said HPD Commissioner Louise Carroll.

“Placing more families to own a home, build wealth for their children, and take ownership of their communities is an important strategy for achieving our vision of a fairer New York City.”

The city administers the program through Neighborhood Services in New York City, and it is funded by the U.S. Department of Housing and Urban Development. According to the city, the program has helped more than 3,000 households become homeowners since 2004.

There are several eligibility requirements a potential home buyer must meet to qualify for the program designated for those purchasing a one-to-four family home, condominium, or cooperative that falls within the approved purchase price limit.

To qualify for the assistance, a home buyer must:

  • Be a first-time buyer
  • Has an annual gross income at or below 80 percent of the area’s median income
  • Complete a homebuyer training course approved by HPD
  • Contribute at least 3 percent of the purchase price to the advance payment, with 1 percent of the contract payment taken from the buyer’s own funds
  • Have an employment record, sufficient financial resources and credit to obtain a mortgage on a bank that is a regulated financial institution
  • Pass a home quality standard inspect before purchase
  • Stay at home for at least 15 years to receive the full benefits of the loan forgiveness program.

Learn more about the HomeFirst Down Payment Assistance program here.

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New York City Department of Housing Preservation & Development

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