Down Payment and Closing Cost Home Ownership Program

What is Down Payment and Closing Cost Home Ownership Program?

Down Payment and Closing Cost Home Ownership Program is a forgivable loan for homebuyers in Bloomington, Indiana.

• Bloomington HAND's Down Payment and Closing Cost HOP — up to $10,000 forgivable 2nd mortgage @ 20%/year over 5 years, 0% interest. First-time homebuyer required, must complete HAND Homebuyers Club. Bloomington city limits; <=80% AMI Monroe County.
• HAND's Down Payment and Closing Cost Home Ownership Program provides up to $10,000 in down-payment and closing-cost assistance to eligible first-time homebuyers in Bloomington. The assistance is structured as a 0% interest forgivable second mortgage that forgives at 20% per year and is fully forgiven after 5 years of owner-occupancy. If the borrower sells, refinances, or vacates before 5 years, a prorated balance is owed back to the City.
• Funding comes from Federal, HOME, CDBG, and City.

Do you have to pay it back?

Down Payment and Closing Cost Home Ownership Program is forgiven after 5 years, so a buyer who stays that long does not repay it.

• Repayment is triggered by Forgiven 20%/year and prorated balance due on sale/refinance/non-occupancy within 5 years.
• The assistance is recorded in 2nd Lien position.
• Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

Down Payment and Closing Cost Home Ownership Program is open to first-time homebuyers and buyers who will live in the home as their primary residence.

What are the income limits?

Down Payment and Closing Cost Home Ownership Program limits household income to 80% of the area median income, which varies by county and household size.

• Household income limits ~80% AMI Monroe County (range $55,650-$104,900 across household sizes per HUD-published limits).
• The limit applies to total household income, not only the borrower&rsquo;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?

Down Payment and Closing Cost Home Ownership Program caps the purchase price as follows: Per first-mortgage product underwriting; HAND does not publish a fixed cap.

• Eligible property types include Single-family detached, condominium, townhouse.
• New construction is eligible.
• Manufactured homes are not eligible.

Where does it apply?

Down Payment and Closing Cost Home Ownership Program serves buyers purchasing in Bloomington, Indiana.

How do you apply?

Applications for Down Payment and Closing Cost Home Ownership Program go through the administering agency, which publishes the current terms and the application steps on its own site.

1. 1

   Take a homebuyer education course

   Required by the program, through City of Bloomington HAND Homebuyers Club (8-hour HUD-approved homebuyer education); completion required prior to receiving assistance..

2. 2

   Contact the administering agency to reserve funds

   Funds are reserved through Direct application through HAND after completing Homebuyers Club; first-come first-served subject to fund availability, and are subject to availability.

3. 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.