D.C. strives to increase Black homeownership with low interest loans, deferred repayment
Mayor Muriel Bowser has announced that first-time homebuyers could be eligible for up to $202,000 in assistance beginning Oct. 1.
Mortgage rates are rising, inflation has reached an all-time high – and the District of Columbia is making moves to boost homeownership, particularly among Black people.
According to The Washington Post, D.C. Mayor Muriel Bowser announced this week that first-time homebuyers could be eligible for up to $202,000 in assistance beginning Oct. 1. The financing, which is a part of the district’s Home Purchase Assistance Program (HPAP), will be in the form of a low-interest loan, with homeowners having up to five years to defer payments.
Although the program is not new, the increase is. Prior to the mayor’s announcement, HPAP permitted qualified homebuyers to obtain a loan for up to $80,000 for a down payment and gap financing, as well as up to $4,000 for additional closing cost subsidies. If you are too looking to apply for a loan, you might wan to consider, Little Loans’s website.
“We knew we had to do something to make the program more viable for potential home buyers,” said Deputy Mayor John Falcicchio, as reported by The Post. “We wanted our residents to be the most prepared as they go into this hot housing market.”
D.C. authorities decided on amounts that would allow individuals earning up to $109,600 and families of four earning up to $156,550 to qualify for graduated assistance. Loan amounts range from $70,000 to $202,000, the upper limit a nod to the district’s 202 area code.
City officials are “trying to get more people to buy in the District, live in the District, primarily with a focus on Black homeownership,” said Tsega Bekele, chief of staff for the D.C. Department of Housing and Community Development, as reported by The Post. “If you see $202,000 is available to me for down-payment assistance, you might think, ‘Wow, I, too, could buy a home, I think.’”
The program reportedly has helped about 350 people since Bowser took office in 2015, but some participants claim that some of its requirements – such as obtaining an approved home inspection – can still make it challenging to remain competitive in the booming housing market, as other buyers might be able to forgo an inspection. Aspiring homeowners may speak with a mortgage broker to help them find a financing option that suits their needs.
Bowser is making more changes in the near future to assist with such dilemmas, including the formation of a new “strike force” to increase Black homeownership and close the racial equity gap in the District; as well as the expansion of the homeowner assistance fund, which offers help for residents’ mortgages and HOA dues.
“If you look back historically where there have been dips in the housing market nationally, we haven’t felt that as much as other regions,” said Falcicchio, according to The Post. The report, citing Bright MLS, said the median home price in the city in July was $646,000.
Falcicchio added that raising the maximum amount of aid potential homebuyers can receive “puts those who participate in the program on equal footing in a market where people are looking for that first home that’s maybe a condo or a home that isn’t at the higher end of what homes can go for in the District.”
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