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Homeownership Down Payment and Settlement Assistance Fund

Dover, Delaware

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Income limit

80% AMI

Of area median income; varies by county and household size

Repayment

Forgivable

Forgiven after 10 years

What is Homeownership Down Payment and Settlement Assistance Fund?

Homeownership Down Payment and Settlement Assistance Fund is a forgivable loan for homebuyers in Dover, Delaware.

  • The City of Dover Homeownership Down Payment and Settlement Assistance Fund (also marketed as the Dover First Start Program) provides forgivable second-mortgage assistance of up to $20,000 to help low- and moderate-income first-time homebuyers purchase a home within the City of Dover. Funded primarily through CDBG and/or city funds, the assistance covers down payment and settlement/closing costs and is forgiven after 10 years of owner-occupancy.
  • Forgivable second mortgage up to $20,000 for down payment and settlement/closing-cost assistance on eligible properties located within the City of Dover. Loan carries 0% interest and is forgiven after 10 years if the borrower continues to occupy the property as their primary residence. Designed to help low- and moderate-income first-time homebuyers (and qualifying single parents/displaced homemakers) purchase a home within the city limits.
  • Funding comes from Federal CDBG and Local Government.

Do you have to pay it back?

Homeownership Down Payment and Settlement Assistance Fund is forgiven after 10 years, so a buyer who stays that long does not repay it.

  • Repayment is triggered by Loan is forgiven after 10 years of continuous owner-occupancy as primary residence. If property is sold, transferred, refinanced (cash-out), or ceases to be the borrower's principal residence within the 10-year period, the full unforgiven loan balance becomes due.
  • The assistance is recorded in 2 position.
  • Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

Homeownership Down Payment and Settlement Assistance Fund is open to first-time homebuyers and buyers who will live in the home as their primary residence.

The program requires

  • First-time homebuyer — with exceptions: Single-parent exception: applicant who has not owned a home for at least 1 year (except as joint owner) may qualify; displaced homemaker exception per HUD definition.
  • The home is occupied as a primary residence
  • On credit: No published Dover-specific minimum; first-mortgage lender's product minimums apply
  • A completed homebuyer education course, through HUD-certified homeownership counseling agency (e.g., NeighborGood Partners/NCALL, Interfaith Community Housing of Delaware); buyer must complete HUD-certified pre-purchase counseling before signing sales contract or applying for first mortgage.
  • Residency: Property must be located within the corporate limits of the City of Dover, DE, and serve as borrower's primary residence.
  • Citizenship or immigration status: U.S. citizen or eligible non-citizen per first-mortgage product rules
  • Buyer must not have owned a principal residence in the prior 3 years (single-parent exception: not owned in last 1 year except as joint owner). Household income must not exceed 80% of HUD area median income for Kent County / Dover by household size (approximately $37,450 1-person to $70,650 8-person at 80% AMI). Property must be located within the City of Dover corporate limits and serve as the buyer's primary residence. Buyer must complete HUD-certified homeownership counseling before contract/loan application and be certified prior to closing. First mortgage must be a fixed-rate loan. If property is sold, transferred, refinanced (cash-out), or ceases to be the borrower's principal residence within the 10-year affordability period, the unforgiven balance becomes due.

The program excludes

  • Manufactured homes
  • Households above 80% of area median income

These are the program's own published rules, not a decision about any individual — the administering agency and a lender determine who actually qualifies.

What are the income limits?

Homeownership Down Payment and Settlement Assistance Fund limits household income to 80% of the area median income, which varies by county and household size.

  • Household income may not exceed 80% of HUD area median income for the Dover, DE HUD income area, adjusted for household size. Approximate range: $37,450 (1-person) to $70,650 (8-person) at 80% AMI under current HUD limits.
  • The limit applies to total household income, not only the borrower’s.
  • Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

What kind of home can it be used for?

Homeownership Down Payment and Settlement Assistance Fund caps the purchase price as follows: No published Dover-specific maximum purchase price; property must be located within the City of Dover corporate limits.

  • Eligible property types include Single-family detached, Townhome, and Condominium.
  • New construction is eligible.
  • Manufactured homes are not eligible.

Where does it apply?

Homeownership Down Payment and Settlement Assistance Fund serves buyers purchasing in Dover, Delaware.

How do you apply?

Applications for Homeownership Down Payment and Settlement Assistance Fund go through the administering agency, which publishes the current terms and the application steps on its own site.

  1. Take a homebuyer education course

    Required by the program, through HUD-certified homeownership counseling agency (e.g., NeighborGood Partners/NCALL, Interfaith Community Housing of Delaware); buyer must complete HUD-certified pre-purchase counseling before signing sales contract or applying for first mortgage..

  2. Contact the administering agency to reserve funds

    Funds are reserved through Application processed through City of Dover Community Development office (or partnering HUD-approved housing counselor) on a first-come, first-served basis subject to fund availability., and are subject to availability.

  3. Work with a lender who handles the program

    Hey Prescott is not a lender and does not accept applications; this page describes the program so a buyer can take it to a lender or housing counselor.

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