Montgomery County's First Time Home Buyer Loan
Montgomery County Home Buyers Program was created to help low,
moderate, and median income families purchase their first home in
Montgomery County, Pennsylvania.
The homebuyer's program offers a closing cost assistance grant as high as 10% of the sales price toward the home buyer's settlement costs.
The grant money for the program is made available through
Montgomery County’s Affordable Trust Fund in coordination with the
Recorder of Deeds Office.
The loan is paid back only when the house is sold or transferred during the first 8 years. The total assistance is dependent on the selling price, closing costs, mortgage amount, and other required costs to purchase the house.
And here’s the best part, the grant is zero percent (0%) interest rate! The loan remains in effect for 8 years.
Repayment of this loan is only required if:
- The house is sold, granted, conveyed, or transferred to another person;
- Or, is changed into an investment property;
- The house is vacated or abandoned as a primary residence within 8 years from the settlement date;
You are required to live in the home as your primary residence.
You must qualify for a mortgage loan at the current interest rate;
MONTGOMERY COUNTY RESIDENCY OR EMPLOYMENT
At application and up to closing, you must reside and/or be employed full time within Montgomery County
HOME BUYER EDUCATION
Prior to executing any contract of sale for the purchase of a home, you are required to complete a home buyer counseling program and meet with a Counselor for a one on one counseling session. The home buying counselor will discuss the importance of establishing a budget, maintaining a good credit rating , mortgage financing and home ownership responsibilities. The counseling session can last a few hours.
ASSETS FOR DOWN PAYMENT & CLOSING COSTS
The program requires that you
have at least $3,000.00 in your checking, saving or investment
account(s) at application (liquid and must be of your own funds).
You must provide at least three percent (3%) of the purchase price for the down payment. You must also have at least two months’ mortgage payments in the bank along with the 3% down payment.
Applicants have to make use of their own assets and may obtain a
matching gift from a relative up to 3% prior to receiving the home
buyer funds. The assistance loan is not available to applicants with
10% or more of the purchase price to put towards purchase. 401K's,
Ira's, and Roths are not considered in the 10% limitation.
All assets have to be completely disclosed at application, if not, the application will be declined.
The applicant must immediately notify the First Time Home Buyer's Program if the applicant's financial information changes prior to closing.
Eligible participants may receive closing costs assistance up to
8% of the purchase price if your household income is 80% of the
median income for Montgomery County or less; and if the household
income is under 80% of the median income, the county will chip in an
additional 2% towards the down payment for a total assistance of 10%
of the sales price.
Maximum Sales Price
The maximum sales price is based on the
applicant's earnings, monthly obligation, etc.
No Seller Assist!
and mortgage lenders. No
closing cost assistance (seller paid closing
costs) is allowed with this program.
Home Warranty & Home Inspection
Department of Housing & Community Development mandates a
inspection and home warranty. Home inspectors are required to
complete a housing quality standards form. This form will be
provided to the applicant at the council ling program.
Existing or recently built single family home situated in Montgomery
Have an agreed upon sales price that does not exceed Program's established affordability.
Meet local codes, Housing Quality Standards, and lead based paint standards.
Be acceptable to the insurer of the property and mortgage lender.
Eligible Mortgage Programs
This closing cost assistance program can be used in conjunction with
the Pennsylvania Housing Finance Agency (PHFA 1st mortgage).
Grant Application Procedure
The grant money is available to all eligible applicants on a first come, first serve
basis. Applicants must be income and loan eligible PRIOR to entering
into an agreement of sale (or putting a deposit on a property).
There is a $25.00 non-refundable fee payable at the time of
Be aware, you must make application, and receive counseling before you sign a sales contract!
Income Eligibility - You must be a first time homebuyer or not owned a home within the previous three years. You must meet Montgomery County household income limits.
How much does it cost to buy a house in Pennsylvania?
Use the PA mortgage calculator to estimate the down payment, closing costs and monthly payment for FHA, VA, USDA & conventional loans.