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Homestart 6% DPA Loan

Statewide, Maryland

Last verified
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Assistance

6%

Of the purchase price, as the program sets it

Income limit

50% AMI

Of area median income; varies by county and household size

Price cap

$1.5M

Highest purchase price the program allows

Repayment

Forgivable

Forgiven once the program's conditions are met

What is Homestart 6% DPA Loan?

Homestart 6% DPA Loan is a forgivable loan for homebuyers in Statewide, Maryland.

  • Maryland DHCD MMP Homestart - 6% deferred 0% DPA second for low-income borrowers at or below 50% AMI ($44,950-$81,000). Bond-funded MRB first. FTHB required. 640 FICO. Statewide.
  • Maryland DHCD's Homestart 6% DPA Loan is a low-income MMP product providing a 0% deferred SECOND mortgage equal to 6% of the first mortgage amount for down payment and/or closing cost assistance. Designed specifically for borrowers at or below 50% Area Median Income (AMI) - household income range $44,950 (low end) to $81,000 (statewide cap). Pairs with a 30-year fixed-rate MMP first mortgage funded via Maryland mortgage revenue bonds. The Homestart 6% second is structured as a 0% deferred no-payment soft second.
  • per MMP Homestart fact sheet, the second is due on sale / refinance / transfer / payoff. Some DHCD Homestart documentation references a forgiveness component for owner-occupancy compliance (verify current forgiveness terms with DHCD lender bulletins). 640 FICO, 45% DTI. Homebuyer education required.
  • Funding comes from State and Bond.

How much assistance does it provide?

Homestart 6% DPA Loan provides assistance worth 6% of the purchase price, as set by the program.

  • Buyer contribution: No mandatory MMP minimum borrower contribution; agency overlays may impose minimum.
  • The program can be combined with other assistance, subject to the rules of each.
  • Amounts are the program's published maximums, not an offer — the administering agency determines any individual award.

Do you have to pay it back?

Homestart 6% DPA Loan is a forgivable loan, so the balance is forgiven once the program's conditions are met.

  • Repayment is triggered by 0% deferred soft second. Full balance due on sale, refinance, transfer of title, payoff of first, or non-owner-occupancy. No monthly payment. Forgiveness terms - if any - per current DHCD Homestart bulletin (some documentation references forgiveness over a defined owner-occupancy period and verify with DHCD).
  • 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?

Homestart 6% DPA Loan 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: FTHB waived in federally targeted tracts and for qualifying veterans (IRS Section 143(d)(2)(B)).
  • The home is occupied as a primary residence
  • On credit: 640 minimum FICO across all eligible first-mortgage products.
  • A completed homebuyer education course, through MMP-approved homebuyer education provider network.
  • Residency: Property in MD; primary residence. Statewide.
  • Citizenship or immigration status: U.S. citizen, permanent resident, or qualifying non-permanent resident alien.
  • LOW-INCOME ELIGIBILITY: Household income at or below 50% Area Median Income (AMI) - $44,950 low end to $81,000 statewide cap (3+ person high-cost county). FTHB required (waived in federally targeted tracts and for qualifying veterans). Owner-occupied primary residence. 640 FICO minimum, 45% max DTI. MMP purchase-price limits ($544,233 to $1,535,015). Homebuyer education required. MMP-approved lender + master servicer. Compliance review of household composition and income required at reservation.

The program excludes

  • Manufactured homes
  • Purchases above the $1.5M price cap
  • Households above 50% 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?

Homestart 6% DPA Loan limits household income to 50% of the area median income, which varies by county and household size.

  • Homestart low-income tier: $44,950 (1-person low end) to $81,000 (3+ person high-cost county cap). At or below 50% AMI per DHCD Homestart fact sheet. Verify county-specific limits on MMP limits page.
  • 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?

Homestart 6% DPA Loan caps the purchase price at $1.5M.

  • Eligible property types include Single-family detached, 2-unit owner-occupied (per overlays), condo (approved), townhouse, PUD.
  • New construction is eligible.
  • Manufactured homes are not eligible.

Is there eligibility for specific groups?

Homestart 6% DPA Loan names veterans, active-duty service members, reservists and National Guard members, and surviving spouses among the groups it serves.

  • Being named here means the program mentions the group, not that membership alone qualifies an applicant — the rest of the eligibility rules still apply.

Where does it apply?

Homestart 6% DPA Loan serves buyers purchasing in Statewide, Maryland.

  • The program targets specific areas: Federally targeted census tracts and high-cost MD counties have elevated income / purchase-price limits within Homestart's low-income parameters.

How do you apply?

Applications for Homestart 6% DPA Loan 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 MMP-approved homebuyer education provider network..

  2. Contact the administering agency to reserve funds

    Funds are reserved through Reserved through MMP Lender Online portal at rate lock; income compliance verified at reservation., 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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