City of Cleveland CDBG Down Payment Assistance Program

What is City of Cleveland CDBG Down Payment Assistance Program?

City of Cleveland CDBG Down Payment Assistance Program is a deferred second loan for homebuyers in Cleveland, Tennessee, administered by City of Cleveland Development and Engineering Services Department; sub-recipients: Habitat for Humanity of Cleveland TN and City Fields CDC.

• The City of Cleveland provides $6,000 in CDBG-funded down payment assistance per household to low-and-moderate-income homebuyers purchasing affordable homes newly constructed by Habitat for Humanity of Cleveland and City Fields CDC within the city's CDBG Target Area. Assistance is structured as a deferred loan repayable upon sale or transfer. The program operates under annual sub-recipient agreements and is governed by the 2024-2028 Five-Year Consolidated Plan; in the 2024-2025 program year Cleveland received $360,241 in CDBG entitlement funds and provided DPA to ten households.
• $6,000 down payment assistance (CDBG-funded).
• Deferred loan, no monthly payments.
• Targeted to newly constructed affordable homes in LMI neighborhoods.
• Delivered through partnership with Habitat for Humanity and City Fields CDC.
• This is a federal program, so it is available beyond a single state or city.
• Funding comes from HUD Community Development Block Grant (CDBG); FY2024-2025 entitlement allocation $360,241.

How much assistance does it provide?

City of Cleveland CDBG Down Payment Assistance Program offers up to $6,000 in assistance.

• The program can be combined with other assistance, subject to the rules of each.
• Amounts are the program's published maximums, not an offer — City of Cleveland Development and Engineering Services Department; sub-recipients: Habitat for Humanity of Cleveland TN and City Fields CDC determines any individual award.

Do you have to pay it back?

City of Cleveland CDBG Down Payment Assistance Program is deferred, so no payments are due until the home is sold, refinanced, or the first mortgage is paid off.

• Repayment is triggered by Sale, transfer, or refinance of the assisted property.
• The assistance is recorded in second position.
• Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

City of Cleveland CDBG Down Payment Assistance Program is open to buyers who will live in the home as their primary residence.

What are the income limits?

City of Cleveland CDBG Down Payment Assistance Program limits household income to 80% of the area median income, which varies by county and household size.

• Household income must not exceed 80% of Area Median Income (HUD LMI definition) for Bradley County; extremely low-income and low-income households prioritized.
• 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?

City of Cleveland CDBG Down Payment Assistance Program can be used for Single Family and New Construction.

• New construction is eligible.
• Manufactured homes are not eligible.

Where does it apply?

City of Cleveland CDBG Down Payment Assistance Program is a federal program, so it is not limited to Tennessee.

• The program targets specific areas: CDBG Target Area within Cleveland city limits, concentrated in Blythe/Oldfield LMI community; includes Victory Cove, Foster Lane, and City Fields developments.

How do you apply?

Applications for City of Cleveland CDBG Down Payment Assistance Program go through City of Cleveland Development and Engineering Services Department; sub-recipients: Habitat for Humanity of Cleveland TN and City Fields CDC, which publishes the current terms and the application steps on its own site.

1. 1

   Contact City of Cleveland Development and Engineering Services Department; sub-recipients: Habitat for Humanity of Cleveland TN and City Fields CDC to reserve funds

   Funds are reserved through first-come, first-served subject to availability; coordinated through sub-recipient nonprofit partners, and are subject to availability.

2. 2

   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.