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Federal Grants for First-Time Home Buyers

House with a sold signMembers of the Federal Home Loan Bank system may get help with mortgages and other housing projects, as well as community development (which includes thrift institutions, credit unions, commercial banks, insurance companies, and approved community development financial institutions). The Federal Home Loan Bank system is made up of 11 regional banks with a total membership of about 7,300 financial institutions.

For first-time home buyers, each bank in the area offers a grant program. A first-time home buyer is defined as follows by the Department of Housing and Urban Development (HUD):

a person who fits one or more of the following criteria:
  • A person who has not owned a primary home for the previous three years, ending on the date of acquisition of the property.
  • A spouse is included in this (if either meets the above test, they are considered first-time home buyers).
  • An individual who has been displaced from his or her house and has only possessed a primary dwelling with his or her spouse.
  • A single parent who has only ever owned a primary home with a previous spouse.
  • A person who has only held a property that did not meet state, municipal, or model building regulations and could not be brought into conformity for less than the cost of erecting a permanent structure.
  • A person who has only possessed a primary home that is not firmly attached to a permanent foundation in line with relevant regulations.

Most Federal Home Loan Bank programs are offered as a forgivable loan. Each year, 20% of the assistance grant will be forgiven. If the house is sold or refinanced within a 5 year time period, the assistance grant will be prorated and paid back to the Federal Home Loan Bank. After 5 years, the home-buyer assistance is FREE!

The money for the grants is always given out on a first-come, first-served basis. Grants are available to member banks of the Federal Home Loan Bank District. The Federal Home Loan Banks provide the grant money to applicants whose household income is at or below 80% of the area's median income. Determining household income should be left to a loan officer.

However, the following will satisfy your curiosity if you might qualify for grant money. Go to the household income lookup and select the current year. Choose the Access Individual Income Limits Area link. The next screen will prompt you to select the state. After selecting the state, select the county. The result will display the HUD median income limits. The grant programs all use 80% of the median income of household members.

Go to the household income lookup and select the current year.

Median income lookup

Choose the Access Individual Income Limits Area link

Access Individual Income Limits Area

The next screen will prompt you to select the state.

Household income limits by state

After selecting the state, select the county.
Household income by county

The result will display the HUD median income limits. The grant programs all use 80% of the median income by household members.

Household income by household members


First-time home buyer grants in Arizona, California, Nevada, and other states where bank members do business.

The Workforce Initiative Subsidy for Homeownership (WISH) and Individual Development and Empowerment Account (IDEA) programs match the down payment and/or closing expenses three to one. The Federal Home Loan Bank of San Francisco will match every dollar the applicant puts into the purchase for the down payment and/or closing expenses with three dollars. The Home Loan Bank will put in $9,000 if you use $3,000 to buy the house. The Home Loan Bank will match your $5,000 investment for a total of $15,000. 

First-time home buyer program for New Jersey, New York, Puerto Rico, and the U.S. Virgin Islands.

If you qualify for the First Home Club grant program, the Federal Home Loan Bank of New York will not buy you a free lunch, but it will provide you with free grant money. A down payment and/or closing cost assistance grant of up to $7,500 is available to eligible home purchasers. The Federal House Loan Bank of New York will “match” the down payment/closing cost investment of the home buyer four to one. In other words, the Federal House Loan Bank will grant/gift four dollars for every dollar spent on a down payment or closing expenses by the home buyer.

For example, if a house buyer contributes $1,000 to the buying price, the FHLB will grant/gift $4,000 to the buyer. If you spend $1,880.00 on the transaction, you will get the maximum award of $7,500. The prospective home buyer(s) must establish a dedicated savings account with a participating lender and agree to save the buyer's contribution on a monthly basis for at least 10 months and up to 24 months.

First-time home buyer program for Pennsylvania, Delaware, and West Virginia.

The Federal Home Loan Bank of Pittsburgh matches grant funds three to one. The Federal House Loan Bank will give you three dollars for every dollar you invest towards the purchase of your home. For instance, if you contribute $1,000 to the purchase of a house, you will get $3,000.

The highest amount of money you can get is $5,000. If you do the arithmetic, that implies you will get $5,000 if you pay $1,667. Applicants must satisfy the income requirements. Read more about the First Front Door grant program

First-time home buyer program for Alabama, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia, and the District of Columbia.

You may be qualified for a $5,000 down payment and/or closing cost assistance loan from the Federal House Loan Bank of Atlanta, if you fulfill the income requirements, have not purchased a home in the last three years, and meet the standard approval standards.

The FHP (First-Time Homebuyer Product) is a four-to-one matching grant with a $5,000 maximum subsidy. The buyer must pay at least $1,000 for the purchase of the property. Each year, the government forgives 20% of the aid grant. After 5 years of ownership, there is no payback. The assistance loan does not require a monthly payment.

Also available is the Community Partners assistance program

If you satisfy the income criteria, have not bought a house in the last three years, and meet the normal approval conditions, you may be eligible for a $5,000 down payment and/or closing cost assistance loan from the Federal House Loan Bank of Atlanta.

The First-Time Homebuyer Product (FHP) is a four-to-one match grant with a maximum subsidy of $5,000. For the acquisition of the property, the buyer must pay a minimum of $1,000. The government forgives 20% of the annual assistance award each year. There is no repayment after 5 years of ownership. There are no monthly payments with the aid loan.

First-time home buyer grants for Ohio, Kentucky, and Tennessee.

The Federal Home Loan Bank of Cincinnati offers the Welcome Home Program.
The funding program covers the down payment and/or closing expenses up to $5,000. Each year, 20% of the assistant grant is forgiven, up to a maximum of 5 years, after which the assistance grant is forgiven.

If the house is sold or refinanced within five years of the closing date, the borrower is obliged to return all or part of the subsidy.

Homebuyers are required to put down at least $500 toward the down payment and/or closing expenses. It is not necessary for applicants to be first-time home purchasers. First-time home purchasers, on the other hand, must finish a home ownership counseling program.

First-time home buyer grants for Alaska, Guam, Northern Marianas, American Samoa, Hawaii, Idaho, Iowa, Minnesota, Missouri, Montana, North Dakota, Oregon, South Dakota, Utah, Washington, and Wyoming.

The Federal Home Loan Bank of Des Moine's Home$tart grant program may provide up to $7,500 to qualified home purchasers. Participants in the Home$tart Plus may be eligible for a grant of up to $15,000 in funding.

To participate in the Home$tart and Home$tart Plus programs, you must have a completed Purchase and Sale Agreement.

First-time home buyer grants for Indiana and Michigan.

The Federal Home Loan Bank of Des Moine's Home $tart grant program may provide up to $7,500 to qualified home purchasers. Participants in Home $tart Plus may be eligible for a grant of up to $15,000 in funding.

To participate in the Home$tart and Home$tart Plus programs, you must have a completed Purchase and Sale Agreement. The Homeownership Opportunity Program (HOP) is offered by the Federal Home Loan Bank of Indianapolis to qualified first-time homebuyers whose family income is at or below 80% of the Area Median Income (AMI).

With a mortgage from an FHLBank Indianapolis member, qualifying families may receive up to $8,000 in down payment and/or closing cost assistance. Applicants must put down at least $1,000 toward the purchase of the property.

The assistance grant is a three-to-one match, meaning the Federal Home Loan Bank will match every dollar the applicant puts into the purchase. If you put $1,000 toward a down payment or closing expenses, you'll get $3,000. Prior to the loan closing, the homebuyer(s) must complete a counseling/education program.

First-time home buyer program for Colorado, Kansas, Nebraska, or Oklahoma.

Home $tart, a grant program run by the Federal Home Loan Bank of Des Moines, may give up to $7,500 to eligible home buyers. Home $tart Plus participants may be eligible for a $15,000 award.

You must have a completed Purchase and Sale Agreement to be eligible for the Home$tart and Home$tart Plus programs. The Federal Home Loan Bank of Indianapolis' Homeownership Opportunity Program (HOP) is available to eligible first-time homebuyers with a family income of less than 80% of the Area Median Income (AMI).

Qualifying families may get up to $8,000 in down payment and/or closing cost assistance if they get a mortgage with an FHLBank Indianapolis member. Applicants must put down a minimum of $1,000 on the property they want to buy.

The assistance grant is a three-to-one match, which means the Federal Home Loan Bank will match every dollar invested in the purchase by the applicant. You'll receive $3,000 for putting $1,000 toward a down payment or closing costs.

A counseling/education program must be completed by the homebuyer(s) prior to the loan closing.

First-time home buyer grant for Illinois or Wisconsin.

Through its member banks, the Federal Home Loan Bank of Chicago offers an assistance grant to qualified home purchasers in Illinois and Wisconsin. The Down Payment Plus® program matches your down payment and closing costs three to one.

That implies the Federal Home Loan Bank of Chicago will match the home buyer's investment with three dollars for every dollar spent on the down payment and/or closing fees. A minimum contribution of $1,000 from the borrower's own money is required toward the purchase of the house.

A maximum award of $6,000 is available.

That implies that if you put down $2,000 on a house, the Federal Home Loan Bank of Chicago will contribute $6,000 toward the down payment, closing fees, and escrow obligations (such as property taxes and homeowner's insurance). For the house buyer's contribution, funds held in the home buyer's checking, savings, or other depository accounts for the previous two months may be utilized.

The house buyer's contribution can not be made with money that has not been confirmed.