Just in time for Homeownership Month, the Tennessee Housing Development Agency is celebrating the 500th home loan under its new $15,000 HHF Down Payment Assistance program.
"Even with sky-high expectations for this program, applications have been rolling in faster than we imagined," said THDA Executive Director Ralph M. Perrey. "Since day one, we've seen this program drive an impressive increase in our overall home loan production."
In May, more than 60 percent of homebuyers in THDA's Great Choice Home Loan program also applied for the new $15,000 HHF Down Payment Assistance program.
To qualify, homebuyers must finance the purchase an existing home in one of 55 designated ZIP Codes with a Great Choice Home Loan.
"We worked with the U.S. Department of Treasury to create a map of neighborhoods where home sales exhibited the greatest need for a shot in the arm, and in fact, we've seen a significant boost in demand for home loans in those areas," said Mr. Perrey. "So the program is working exactly as intended, even faster than anticipated."
THDA hailed its 500th homebuyer under the $15,000 HHF-DPA program on the last day in May, giving the agency an extra reason to celebrate this Homeownership Month. By proclamation of Governor Bill Haslam, June is Homeownership Month in Tennessee.
"The benefits of homeownership reach far beyond the individual family, because homeowners are invested members of their community, financially and emotionally," said Mr. Perrey. "In fact, that's the whole purpose behind our new $15,000 HHF-DPA program. By attracting new homeowners, we're also bringing new energy and new life to these neighborhoods."
To date, approximately $7.5 million has been awarded to homeowners under the $15,000 HHF Down Payment Assistance program.
THDA received $60 million from the U.S. Department of Treasury's Hardest Hit Fund to launch the program, which is designed to stabilize home prices and prevent foreclosures by generating renewed interest in neighborhoods where home sales and certain other economic indicators lag behind the rest of the state.
Approved homebuyers receive $15,000 financial assistance in the form of second mortgage loan to be applied toward down payment and closing costs. This loan requires no monthly payments, accrues no interest, and may be completely forgiven without repayment if the homebuyer remains in the home for more than 10 years without selling or refinancing.
THDA's Great Choice Home Loan program offers a 30-year, fixed interest rate first mortgage loan to Tennesseans of moderate income. These home loans require at least a 640 credit score and are limited to first-time homebuyers in some areas. Homebuyers in areas that do not qualify for the $15,000 HHF Down Payment Assistance program can still apply for financial assistance in the form of a 30-year Great Choice Plus second mortgage loan. This loan requires no monthly payments, accrues no interest, and is available in an amount up to five percent of the home's purchase price.