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Help for D.C. home buyers

The District's Employer Assisted Housing Program offers District government employees, including teachers and first responders, a deferred zero-interest loan and matching grant for down payment and closing cost assistance. (iStock)

To encourage homeownership and make it accessible to a broader range of people, the District has several programs that offer down payment assistance, closing cost assistance, low mortgage rates and tax credits. Some are restricted to first-time buyers and others are open to all buyers who meet the program’s qualifications. Most require prospective buyers to attend home-buyer education classes as part of their financial preparation.

Here are some available programs in the District:

DC Open Doors: Run by the D.C. Housing Finance Agency, DC Open Doors offers a loan for the full amount of your mortgage program’s down payment. The zero-percent interest loan doesn’t require payments or accrue interest. It is due either 30 years after the closing date, when the home is sold or ownership is transferred, when the home is no longer your principal residence or when you refinance. You don’t have to be a first-time home buyer or a D.C. resident. To qualify, borrowers must have a credit score of 640 or higher, a maximum income of $145,560 (just the borrower’s income, not the household income), a maximum purchase mortgage of $510,400 and a maximum debt-to-income ratio of 45 or 50 percent. Your debt-to-income ratio compares the minimum payment on all debt with your gross monthly income. Informational webinars about this program are held several times a month and are listed on the agency’s website.

Programs to help home buyers in Northern Virginia

Home Purchase Assistance Program: This program, operated by the D.C. Department of Housing and Community Development, has interest-free loans for down payment and closing cost assistance of up to $80,000 for down payment and up to $4,000 for closing costs. This program is limited to first-time home buyers who have a low-to-moderate income. The maximum purchase mortgage amount is limited to $510,400. Borrowers with incomes below 80 percent of area median income must repay the loan when they sell the property, when it is no longer their principal residence or when they refinance. Borrowers with incomes between 80 and 110 percent of area median income will have payments on the program’s loan deferred for five years and then must repay over 40 years.

Employer Assisted Housing Program: The program offers District government employees, including teachers and first responders, a deferred zero-interest loan and matching grant for down payment and closing cost assistance. The maximum purchase price for this program is $765,600, and there is no income cap. The maximum down payment and closing cost loan is $20,000 and the maximum grant amount is $5,000. The loan must be repaid when the property is sold, refinanced with cash taken out or is no longer the borrower’s principal residence.

First responders may be eligible for up to $10,000 as a grant for down payment assistance that would not need to be repaid if they commit to five years of service. They are also eligible for up to $15,000 in matching grant funds.

Mortgage Credit Certificate: The Housing Finance Agency’s mortgage credit certificate allows first-time buyers who meet income and home sales price qualifications to take 20 percent of the mortgage interest they pay each year as a federal income tax credit. The maximum home price is $530,000 and the maximum loan amount is $510,400. The income limit ranges from $140,640 to $164,080 depending on the household size and the location of the property. Borrowers can use the DC Open Doors loan program or work with a DCHFA participating lender to request the certificate.

Read more:

Expo aimed at first-time home buyers and renters goes virtual

Rental market reacts to coronavirus but stays active

Profiles of first-time buyers show the many pathways to homeownership

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