DPA: NCHFA NC Home Advantage Mortgage

Alethea F Nobles

Alethea F Nobles

— 2 min read

Go to https://www.nchfa.com/home-buyers/income-limits

The North Carolina Housing Finance Agency (NCHFA) NC Home Advantage Mortgage program offers qualified homebuyers affordable FHA, VA, USDA, or Conventional mortgage financing (30-year, fixed-rate term with zero discount points), and forgivable down payment assistance (DPA). First-time homebuyers or military veterans may be eligible to combine the NC Home Advantage Mortgage with the NC Home Advantage Tax Credit.

DPA: Eligible Purchasers (Borrowers) may borrow 3% or 5% of the loan amount or appraised value, whichever is lower, at zero (0%) interest when using a FHA, VA, or USDA loan. Purchasers (Borrowers) using a Conventional loan, are eligible for up to 3%.

Homebuyer Eligibility Requirements

  • There are "NO" first time homebuyer requirements; however, if all purchasers (borrowers) are first-time homebuyers, they must complete an approved Home Buyer Education class.
  • Must purchase the a new or existing primary residence (single-family detached or semi-detached, townhouse, condominium unit, duplex, modular or new manufactured) in North Carolina.
  • May own other property as long as the Purchaser (Borrower) meet the underlying program guidelines and DPA guidelines.
  • Purchaser (Borrower) must meet qualifying income limits; currently $126,000.00.
  • Purchaser (Borrower) must occupy the primary residence within sixty (60) days of closing.
  • Purchaser (Borrower) must be a legal resident of the United States.
  • Must meet the requirements for a FHA, VA, USDA, or Conventional mortgage loan, through an NCHFA participating lender, an addition to NCHFA guidelines.
  • All mortgage loans must receive an Automated Underwriting Systems (AUS) Approve/Accept credit recommendation and have a "representative" or single applicable credit score (the lower score when two (2) credit scores are obtained or the middle score when three (3) scores are obtained) of '640'or above; a '660' credit score or higher is required for new manufactured homes. All Purchasers (Borrowers) must have two (2) or more credit scores each if there are more than one individual applying for the same mortgage loan.
  • The Debt-to-Income (DTI Ratio) is a maximum of 43% on all loan types.
  • All mortgage loans' interest rates are Lock-In for a sixty (60)-day period.
  • Purchasers (Borrowers) may not receive NO more than $1,000.00 'CASH BACK' at closing and DPA funds can NEVER be given as 'CASH BACK'.
  • REPAYMENT of all down payment options is required ONLY if the Purchaser (Borrower) sell, refinance or transfer the primary residence BEFORE ownership Year 15. The DPA funds are provided as a zero (o%) interest, 15-Year deferred/forgiven subordinate lien (2nd mortgage). This lien DEFERRED for the first (10) years and FORGIVEN at 20% per year at the end of ownership Years 11-15, with complete forgiveness at the end of ownership Year 15.

% of Loan-to-Value Available to Purchasers (Borrowers)

  • FHA (96.5%) with an upfront 1.75% Mortgage Insurance Premium (MIP)
  • VA (100%)
  • USDA (100%)
  • Conventional (97%) with Mortgage Insurance (MI) terminating when LTV reaches 78%

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