Arizona Launches Path to Home Ownership

The Arizona Housing Finance Authority launched a new program called the HOME Plus home loan program that will assist prospective homebuyers with a non-repayable down-payment assistance grant. The new loan program is available to statewide renters (except those in Pima County). The program was introduced as a response to increasing rents, which often prevent creditworthy renters from being able to save enough money for a down payment. Buyers who have sufficient credit to be approved to buy a home are eligible.

The down-payment assistance grant can be used for the down payment and closing costs of a home equal to 4 percent of the initial principal balance of the mortgage loan. Qualified U.S. military personnel and veterans may receive an additional 1 percent of down-payment assistance for a total of 5 percent of the mortgage amount.

Dirk Swift, the Arizona Housing Fi­nance Authority’s Homeowner Pro­grams ad­min­istra­tor, said in a press release that HOME Plus raises funds for its initiative in national capital markets and forms partnerships with banking and lending institutions to facilitate the HOME Plus program throughout Arizona.

Homeownership rates in Arizona mirror the national average, which is at its lowest rate in two decades. But despite these low ownership rates, many who rent still want to own their own home. “Zillow research has found that Mil­lennials are now actually more eager to own a home than older Americans, but their biggest challenge is coming up with enough money for a down payment,” Swift explained to Professional Builder. “With the HOME Plus program, this obstacle has been removed. Over the past two months, the Arizona Housing Finance Authority has helped more than 275 new homebuyers by providing more than $1.7 million in down payment assistance grants.”

Swift notes the challenge in boosting awareness of the down-payment assistance program. “A recent Neighbor­Works American study showed 70 percent of Americans are unaware of down-payment assistance programs,” Swift says. “When homebuyers don’t know down-payment assistance programs exist, they aren’t seeking these solutions.” The HOME Plus program creates a pathway to homeownership by giving creditworthy renters who can qualify for a mortgage but cannot afford the down payment the funds they need to purchase a home of their own.

Those who have an annual household income of less than $88,340 and are planning to buy a home that costs less than $353,360 can access the funds for the down-payment assistance grant. Buyers must work through an Arizona Housing Finance Authority approved and participating lender to obtain a Fannie Mae HFS Preferred 30-year fixed mortgage. The grant is only available in conjunction with a HOME Plus loan, and those using the grant do not have to be first-time homebuyers to qualify.