Listed NY Realty
The FHA, or Federal Housing Administration, provides mortgage insurance on loans made by FHA-approved lenders. FHA insures these loans on single family and multi-family homes in the United States and its territories. An FHA Loan is a mortgage that’s insured by the Federal Housing Administration. They allow borrowers to finance homes with down payments as low as 3.5% and are a good option for first-time homebuyers.
To qualify for this low down payment, the borrower must meet the following requirements:
- The home must be the borrower’s primary residence
- FICO® score at least 580. A score of 500-579 would require 10% down payment.
- Mortgage Insurance Premium(MIP) Required.
- Must meet lender’s required debt to income ratio, which could vary
- Borrower must have steady income and show proof of employment
Down Payment Assistance Loan (DPAL), is a SONYMA mortgage program designed to make the road to home ownership easier with no points, low interest rates and low down payment options.
SONYMA’s Down Payment Assistance Loan (DPAL), which is available for all buyers using a SONYMA mortgage program, can provide the initial funding you need to purchase your first home. This enables buyers to attain a mortgage with less money out of pocket.
Down Payment Assistance Loan Benefits
- 0% interest rate
- No monthly payments
- Forgiven after 10 years
- Minimum loan amount: $1,000
- Maximum loan amount: 3% of the purchase price (up to $15,000) or $3,000, whichever is highest
Additional Notes for DPAL
- A Down Payment Assistance Loan cannot exceed your actual down payment and/or closing costs.
- Interest rates for first-time mortgages with a DPAL attached will be .375% higher than mortgages without. This higher interest rate does not apply to our Graduate to Homeownership, Homes for Veterans, or ENERGY STAR® programs.
- All or a portion of your Down Payment Assistance Loan may be required to be repaid if you sell your home or refinance your mortgage within the first 10 years of purchase. The amount subject to possible repayment will decrease by 1/120 per month each month you live in the property. In the event the proceeds from the sale of your home is not enough to pay any repayable amount, the shortage will be forgiven.
- Regardless of which SONYMA program you apply for, you must make a minimum cash contribution of 1% of the value of the property (3% for cooperatives and 3- and 4-family properties).
- DPALs may only be used in conjunction with a SONYMA mortgage and may be used for any property type eligible under your chosen mortgage program, including cooperatives.
- Cash back at closing is not allowed with a DPAL, except in special circumstances.
- SONYMA will not allow your DPAL to be subordinate to another mortgage.
The VA loan is a $0 down payment mortgage option available to Veterans, Service Members and select military spouses. VA loans are issued by private lenders and guaranteed by the U.S. Department of Veterans Affairs (VA).
Features and requirements of VA Loans
- 0% down for qualified buyers
- No PMI (Private Mortgage Insurance)
- Competitive interest rates
- Loans up to $726,525 for qualified buyers in all New York City boroughs, Nassau, Suffolk, Westchester and Rockland counties
- Limited closing costs
- Funding fees apply
Most mortgages require a 20% down payment to avoid paying PMI (private mortgage insurance), but this special program enables buyers to obtain a no PMI mortgage with as little as 10% down, resulting in considerable monthly savings.
Features and requirements:
- Minimum 10% down-payment
- 30-year mortgage at 4.75 %* (Rate subject to change)
- Subject to lender terms and approval.