Mississippi can be a great place to buy a home, especially considering its one of the states with the lowest average mortgage debt and median housing prices. Those looking for further help may be able to utilize grants and down payment assistance offered by local and national programs. The Mississippi Home Corporation and the Mississippi Legislature are two organizations that offer such programs.
If you're thinking about purchasing a home in Mississippi, you may have options to help with the down payment or closing costs. Read below to learn more about any program and see if it can help with your home purchase!
Offered through the Mississippi Home Corporation, Smart Solution Second is an add-on down payment assistance program to the Smart Solution Mortgage.
Smart Solution Second provides a down payment of 3.5% of the house’s purchase price. It’s offered as a second mortgage with a 10-year loan term and the same interest rate as the first Smart Solution Mortgage.
The same requirements for the Smart Solution Mortgage apply for Smart Solution Second. Namely, the property being purchased using these programs must be owner-occupied, found in Mississippi, and be either a single-family house, townhome, condominium or duplex. Manufactured houses are also allowed as long as they have FHA financing.
Furthermore, the applicants’ annual household income cannot be more than $95,000 as of 2020. All applicants must be a United States legal resident and have a credit score 640 or higher.
The Mortgage Revenue Bond 7 (MRB7) program is offered through the Mississippi Home Corporation (MHC). This is a mortgage loan with an additional $7,000 loan as down payment assistance.
The $7,000 can be forgiven after 10 years, and these funds are offered as a 10-year loan with 0% interest.
The MHC can offer this program due to revenue from selling Mortgage Revenue Bonds, which are federal tax-exempt.
In order to qualify, an applicant must be either a first-time homebuyer (meaning they have not owned a house in the past three years), a veteran, or buying in a designated target area. Applicants will also have to meet credit and income limits. Finally, applicants must be United States legal residents.
In order for the property being purchased to be eligible, it must be a single-family house, townhome, or condominium, or a manufactured house with a permanent foundation, located in Mississippi. The property will also have to fall within purchase price limits.
In order to address a shortage of teachers in parts of Mississippi, the Housing Assistance for Teachers (HAT) program was created by the Mississippi Legislature through the “Mississippi Critical Teacher Shortage Act of 1998.”
HAT offers up to $6,000 for the down payment and closing costs, which can be forgiven as long as the individual is employed for at least three years by a school in an area with a teacher shortage.
The property that the teacher is purchasing must also be in the area where the teacher will be employed, and must also be designated as a teacher shortage area.
No income limits apply to the HAT program, but the applicant must be able to put down at least 1% of the purchase price for the down payment from their own funds. Gift funds are not allowed for this requirement. Applicants must also have at least one month’s worth of housing expenses in reserve. This reserves requirement can be met by gift funds.
A list of locations in Mississippi that have a shortage are listed on the Mississippi Home Corporation’s website. These areas need teachers that specialize in the following subjects: Special Education; Mathematics; Foreign Language (French, German, Spanish); Science (Biology, Chemistry, Physics).