FHA Closing Cost Assistance Loan Program

What is FHA Closing Cost Assistance Loan Program?

FHA Closing Cost Assistance Loan Program is a grant for homebuyers in Reading, Pennsylvania.

• Neighborhood Housing Services of Greater Berks (NHS Greater Berks) is a HUD-approved housing counseling agency and CDFI-affiliated lender serving Berks County and the City of Reading, PA. NHS operates three distinct in-house lending products. The FHA Closing Cost Assistance Loan Program is a small amortizing second mortgage of up to $10,000, paired exclusively with an FHA-insured first mortgage, used to cover closing costs when the seller cannot contribute. NHS underwrites the second mortgage in tandem with the FHA first.
• Up to $10,000 in closing-cost assistance for buyers using an FHA-insured first mortgage to purchase a primary residence in NHS Greater Berks's service area. Provided as a small amortizing second mortgage at a low fixed rate, designed to bridge gaps that arise on FHA transactions where the seller cannot contribute the full closing cost.
• Funding comes from NHS CDFI capital, PHFA Housing Trust Fund, and Local Government.

Do you have to pay it back?

FHA Closing Cost Assistance Loan Program is structured as a grant, so it is not repaid.

• Repayment is triggered by Amortizing monthly payments over the loan term and due on sale, refinance with cash-out, or transfer.
• 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?

FHA Closing Cost Assistance Loan Program is open to buyers who will live in the home as their primary residence.

What are the income limits?

FHA Closing Cost Assistance Loan Program limits household income to 140% of the area median income, which varies by county and household size.

• Household income approximately $52,500 (1-person) up to $129,872 (8-person, ~140% Reading MSA AMI). Limits updated annually.
• The limit applies to total household income, not only the borrower’s.
• The program lists a maximum household size of 8.
• 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?

FHA Closing Cost Assistance Loan Program caps the purchase price as follows: Tracks NHS Greater Berks underwriting guidelines.

• Eligible property types include Single-family detached, Townhouse, Condominium, and 2-4 unit (owner-occupied).
• New construction is eligible.
• Manufactured homes are not eligible.

Where does it apply?

FHA Closing Cost Assistance Loan Program serves buyers purchasing in Reading, Pennsylvania.

• The program targets specific areas: Berks County, PA and the City of Reading.

How do you apply?

Applications for FHA Closing Cost Assistance Loan 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 NHS Greater Berks HUD-approved housing counseling program - pre-purchase 8-hour homebuyer education and one-on-one counseling required..

2. 2

   Contact the administering agency to reserve funds

   Funds are reserved through First-come, first-served; applicants apply directly through NHS Greater Berks lending team after first-mortgage pre-approval., 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.