Down Payment Assistance Programs for Oregon Home Buyers 2022
The process of buying a home can seem daunting to first-time buyers with all its jargon and deadlines, not to mention the fast pace at which it oftentimes moves. And how many people have a nest egg sitting around large enough to meet the typical cost of a down payment?
If you dream of owning a home and think you’ll never make it a reality because you can’t imagine pulling together a down payment, have heart. There’s help out there.
We searched for available programs for potential Portland home buyers and found a few designed to encourage home ownership, no matter your income level. You might be surprised to find that you qualify for more than one of these programs that can help you cross the threshold from renter to home owner.
Researching and using these programs can feel just as confusing and obscure as the home buying process itself. They’re offered at federal, state, county, and city levels, often with overlapping stipulations. Here, we’re sharing the best down payment programs available in the Portland metro area and how you might qualify for them.
What is Down Payment Assistance?
Down payment assistance programs vary and so do their qualifications. They come in the form of grants (aka cash assistance) designed to help lower income buyers put together a down payment on a home. In most cases, these programs are offered to “first time home buyers,” which, by definition, means anyone who has not owned and occupied a primary residence in at least three years.
The FHA loan is a national program with a wide reach. It allows buyers to purchase a home with a down payment of only 3.5% of the purchase price, rather than the standard 20%. This is an excellent opportunity for aspiring home owners to enter the market and increase their assets. One of the requirements of an FHA loan is that the buyer purchase mortgage insurance.
If that sounds like another daunting or costly step in the process, know that the state of Oregon and the city of Portland offer some of the best incentives towards home ownership you can find. Read on to find out how to take advantage of Portland’s most beneficial down payment assistance programs.
Oregon Bond Residential Loan Program
Oregon’s tradition of community support is evident in the Oregon Bond Program. It uses funds from previous bonds and it allows first-time home buyers to secure a below-market interest rate and/or cash assistance.
For their Rate Advantage Program, the current rate is 2.25%. For the Cash Advantage Program, which includes cash assistance, the rate stands somewhat higher at 3.0%.
To Qualify for Oregon Bond You Must:
- Be a resident of Oregon
- Be a first time home buyer (not owned a home for at least three years)
- Meet income requirements (though for targeted areas, those limits are waived)
- Find an approved lender
Read more about the Oregon Bond Residential Loan Program.
Oregon Individual Development Accounts
An Oregon Individual Development Account, or IDA, is an excellent resource to grow a nest egg. While this program isn’t specifically designed to help with real estate down payments, it provides a way to set savings goals and have your benchmark dollar amount matched with funds from businesses and personal donors.
Managed by Neighborhood Partnerships, IDAs help low income individuals reach (and at least double) savings goals.
To Qualify for an IDA You Must:
- Be an Oregon resident over 12 years old
- Meet the program’s income eligibility
- Have a net worth below $20,000
- Commit to a monthly savings plan, including financial education, with an IDA provider
Portland Down Payment Assistance Program
The Portland DPAL is designed to encourage home ownership, specifically in the Interstate Corridor Urban Renewal Area. It’s a second mortgage loan funded primarily by the Portland Housing Bureau that also partners with a number of local organizations to bring affordable home ownership opportunities to Portlanders. There’s also a loan forgiveness component to the DPAL.
To Qualify for DAPL You Must:
- Be a first time home buyer (or not owned and occupied for at least three years)
- Be approved for a mortgage through one of the community partners linked above
- Maintain an annual household income at or below 100% of Portland’s current Area Median Income
- Have no more than $10,000 in liquid assets
- Contribute an investment of at least $500
- Complete a home buyer education course approved by HUD
Portland Housing Center’s Mortgage/Down Payment Assistance Program
The nonprofit Portland Housing Center has been investing in affordable housing for individuals and families since 1991. In addition to providing education around the home buying process, they also offer services like competitive mortgages, down payment/closing cost assistance, grants, matched savings, tax incentives, and more.
Huge List of Helpful Home Buying Programs in Oregon
The state of Oregon keeps a list of helpful home buying programs on their website, broken down by the Oregon county they serve. Find the list here.
Beware of First Time Homebuyer Scams
Rent to own (sometimes called lease option or lease to own) is something homeowners often consider offering tenants in a seriously cold real estate market in order to fill vacancies, but in Portland’s hot sellers and renters market, most of these offerings are nothing more than elaborate scams. Homeowners / landlords have no incentive to offer these programs in a decent or hot market. Look elsewhere and don’t get pulled into a scam.
Credit repair scams are prolific online. The Federal Trade Commission has an advisory on them here.
Outside of legitimate home buyer assistance non-profits organizations or government housing departments (as found on the state of Oregon’s website), the FHA loan program, and Portland’s DPAL program, one can expect to find numerous scams. Stay focused on official programs and remember to be patient.
Talk to a Top Portland Buyers Agent
Our team is familiar with these programs and more. Contact our top 1% Portland buyers team today at 503-773-0000 or chat with the bot on our site. We’d love to help you find a way to make your homeownership dreams a reality.January 28, 2022