Washington Down Payment Assistance

Whether you want to be in Washington's bustling cities or enjoying its picturesque nature, the state of Washington has something for everyone. However, it's also listed as one of the states with the highest average mortgage debt and median housing prices. This can make homeownership in Washington difficult.

Luckily, local and national programs exist that offer down payment assistance and grants to qualified applicants. The Washington State Housing Finance Commission is one organization that offers such programs.

If you're thinking about purchasing a home in Washington, you may have options to help with the down payment or closing costs. Click on any program below to learn more and see if it can help with your home purchase!

Tacoma Down Payment Assistance Program

Offered by the Washington State Housing Finance Commission, Tacoma Down Payment Assistance is a loan in the form of a second mortgage that can be used with the Home Advantage loan. As much as $20,000 is offered to help with costs associated with closing and the down payment.

This loan has a simple interest of 4%, but payments can be deferred for up to 30 years. While this loan does not have a monthly payment requirement, the loan must be repaid either when the house is sold, refinanced, transferred, is no longer the borrower’s primary residence, or when the first mortgage has been paid in full.

In order to qualify, the applicant must be a first-time homebuyer and must be planning on using the house as their primary residence. The applicant must be able contribute at least $500 towards the home purchase, but this is allowed to be from gift funds if necessary. Homebuyer education will be required. Applicants also have to meet specified income limits, which as of 2020, are as follows:

-- 1 person household: $40,500
-- 2 person household: $46,300
-- 3 person household: $52,100
-- 4 person household: $57,850
-- 5 person household: $62,500
-- 6 person household: $67,150
-- 7 person household: $71,750
-- 8 person household: $72,300

The property cannot have had any tenants for at least 90 days before the sale agreement. Manufactured homes are not allowed with this program. The house must also fall within the following purchase price limits for 2020:

-- Existing Construction: $218,000
-- New Construction: $228,000

Seattle Downpayment Assistance Program

This downpayment assistance program, which is offered by Washington’s Housing Finance Commission as a second mortgage, can be combined with either the Home Advantage or Opportunity mortgage as the first loan.

For those looking to buy their home in Seattle, as much as $55,000 is offered as down payment and closing cost assistance. Payments for this loan are deferred for as long as 30 years, with a 3% simple interest rate. Only first-time homebuyers who plan to use their home as a primary residence are allowed.

Applicants must participate in a homebuying education seminar, which is also offered by the Washington State Housing Finance Commission, and obtain a certificate of completion. As of 2020, seminars are virtual only. They are five hours or longer and offer information necessary to purchase, own and maintain a home. Advanced reservations are required for seminars.

Applicants must be able to put down at least 1% of the sales price of the house, or $2,500 (whichever amount is larger). Gift funds can be used for as much as 25% of the required payment, but no more than that. Borrowers must also fall within specified household income limits, which depend on household size.

Pierce County Downpayment Assistance Program

This is another downpayment program offered by the Washington State Housing Finance Commission. As much as $24,900 is offered as a second mortgage with a simple interest of 4%.

Repayment of this loan is deferred for up to 30 years; the loan amount only becomes due at the time that the property is sold, refinanced, transferred, is no longer owner-occupied, or has the first mortgage paid off. A $1,000 minimum payment is required from the applicant to be put towards the home purchase, but this amount can be gifted if necessary.

Only first-time homebuyers are allowed to participate in this program. Furthermore, applicants must participate in a homebuying education seminar, which is also offered by the Washington State Housing Finance Commission, and obtain a certificate of completion. As of 2020, seminars are virtual only. They are five hours or longer and offer information necessary to purchase, own and maintain a home. Advanced reservations are required for seminars. Pre-purchase counseling on an individual basis will also be required.

Individuals must also meet the following income limits (as of 2020):

1 person household: $41,750
2 person household: $47,700
3 person household: $53,650
4 person household: $59,600
5 person household: $64,400
6 person household: $69,150
7 person household: $73,950
8 person household: $76,500

Only houses that will be owner-occupied will be allowed. The property must be in Pierce County, but not Tacoma, Lakewood, Bonney Lake, Auburn, or Pacific City.

The property must fall within the following purchase price limits for 2020:

  • Existing Construction - $247,000
  • New Construction - $303,990

Furthermore, the property cannot have had any tenants within 90 days of the sale agreement or closing.

Opportunity Downpayment Assistance Loan Program

Another downpayment assistance program offered by the Housing Finance Commission of Washington State, Opportunity DPA allows for a borrower to receive as much as $10,000.

The amount that the applicant qualifies for is based partly on need, with the exception of Veterans, who don’t require a need-assessment to qualify. This assistance is classified as a second mortgage with a 1% interest rate. It’s meant to be used with an Opportunity first mortgage loan.

In order to qualify, applicants have to be either first-time homebuyers or buying a house in a designated target area. Applicants also have to attend a seminar about homebuying. Applicants must fall within specified income limits that vary by location and household size.

HomeChoice Down Payment Assistance Program

If you or a member of your household have a disability, you may be eligible for HomeChoice down payment assistance, a program offered by the Washington State Housing and Finance Commission. This is a second mortgage loan for as much as $15,000 to help with the costs of closing and the down payment. It has an interest rate of 1%, but does not need to be repaid until the house is sold, refinanced, or 30 years have passed.

HomeChoice is meant to be used with a House Key or Home Advantage first mortgage.

In order to qualify, in addition to having a disability or living with a family member with a disability, the applicants have to be either first-time homebuyers or purchasing a house in a designated target area. Applicants also have to attend a seminar about homebuying.

Income limits, which vary by location, apply for this program. As of 2020, these limits are:

  • King or Snohomish County: $96,000
  • Island County: $77,300
  • Kitsap County: $77,100
  • All Other Counties: $76,500

Bellingham Downpayment Assistance

If you live in Bellingham, Washington, and have a Home Advantage or House Key Opportunity first mortgage, then you may be able to qualify for this down payment assistance program from the Washington State Housing Finance Commission.

As much as $40,000 is offered in the form of a second mortgage with 3% interest and deferred payment. Payment is only due when the property has been sold, transferred, refinanced, is no longer owner-occupied, or when the first mortgage has been paid off.

The applicant must be able to put down at least $2,500 towards the home purchase, or 1% of the sales price, whichever amount is larger. However, as much as 25% of the required amount can be from gift funds (but the rest must come from the applicant’s own assets).

Only first-time homebuyers can apply, and they must attend both a homebuying seminar and individual homebuyer counseling before they will be approved. Applicants must also fall within specified income limits, which depend on household size and are as follows for 2020:

  • 1 person: $38,300
  • 2 person: $43,750
  • 3 person: $49,200
  • 4 person: $54,650
  • 5 person: $59,050
  • 6 person: $63,400
  • 7 person: $67,800
  • 8 person: $72,150

The applicant must be planning on using the property as their primary residence. Furthermore, the property cannot have had any tenants occupying it within 90 days of closing or the sale agreement. The property must also fall within a sale price of $299,025.

ARCH East King County Downpayment Assistance Loan

For certain cities, this down payment assistance program can be used in combination with a Home Advantage mortgage. As much as $30,000 is offered with a 4% interest rate to help with the down payment. However, the applicant must be able to put down a minimum of 2% of the purchase price from their own funds. Half of this can come from gift funds if necessary.

This loan has deferred payment and only becomes due if the property is sold, transferred, refinanced, or is no longer owner-occupied, or when the first mortgage has been paid in full.

Applicants must attend both a homebuying seminar and individual homebuyer counseling.

This program is available in the following cities: Beaux Arts Village, Bellevue, Bothell, Clyde Hill, Hunts Point, Issaquah, Kenmore, Kirkland, Medina, Mercer Island, Newcastle, Redmond, Sammamish, Woodinville, and Yarrow Point. Only properties that will be owner-occupied will be allowed. Furthermore, the property cannot have had any tenants occupying it within 90 days of closing or the sale agreement. The property must also fall within a sale price of $373,000.

As of 2020, the income limits for this program are:

  • 1 person household: $50,400
  • 2 person household: $57,600
  • 3 person household: $64,800
  • 4 person household: $72,000
  • 5 person household: $77,800
  • 6 person household: $83,350
  • 7 person household: $89,300
  • 8 person household: $95,050

Home Advantage Down Payment Assistance Loan Program

This down payment assistance program is offered as a 0% interest second mortgage to be used with a HomeAdvantage mortgage loan. Payments on this loan are deferred for up to 30 years.

Applicants can qualify for as much as 4% of their first mortgage in assistance funds.

For those applying for the need-based option of down payment assistance, applicants are eligible to receive as much as $10,000. The need-based option has a 1% interest rate. Veterans can be eligible for this loan without meeting the need requirement.

A homebuyer seminar is required for both options.

Applicants also must fall within defined income limits.

Veterans Downpayment Assistance Loan Program

This Down payment assistance program specifically for veterans is offered by the Washington State Housing Finance Commission.

This program, which is meant to be combined with a HomeAdvantage mortgage, can offer qualified veterans as much as $10,000 in assistance funds. This is offered as a 3% interest second mortgage with a 10-year term.

In order to qualify, the applicant must be: an individual with an honorable discharge or an honorable record and a medical discharge; a current member of the Washington National Guard and Reserve, or a former member with an honorable discharge; or a never-remarried spouse or dependent child of a deceased veteran. Applicants must also be either first-time homebuyers or purchasing a house in a designated target area. A homebuyer seminar must also be attended.

Income limits as of 2020 are as follows:

  • King and Snohomish Counties: $96,000
  • Kitsap County: $77,100
  • Island County: $77,300
  • All Other Counties: $76,500

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