Where down-payment assistance comes from

The short version

Down-payment assistance helps a buyer with part of the cash a purchase needs. It usually comes as a second mortgage, paired with the first, and programs exist in both Georgia and Florida.

Each program decides which first mortgage it goes with. In Florida, the state's housing finance agency, Florida Housing (the Florida Housing Finance Corporation), runs assistance programs. Its assistance comes only with Florida Housing's own first mortgage, made through participating lenders, so it isn't something that can be added to just any loan.

How it's structured

Some assistance is forgiven over time, and some is repaid. Either way, it's usually a second loan, not money given outright.

I place assistance alongside FHA loans in Georgia and in Florida. In Florida, that includes Florida Housing's programs, where the FHA loan is made as Florida Housing's own first mortgage, with its assistance alongside.

What programs often ask for

Programs often carry rules like these.

• A first-time-buyer rule
• An income limit or a price limit
• A homebuyer-education course

Three common misunderstandings

Here's how each one actually stands.

• It's usually a second mortgage, forgiven over time or repaid, rather than money given outright.
• Not every program is limited to very low incomes. Each program sets its own limits.
• It doesn't necessarily cover every cost of a purchase. Closing costs, prepaid items and earnest money are part of the picture too.

Who decides, and why it changes

Each program's rules decide who can use it and which first mortgage it goes with, and the lender's own requirements apply to the loan too. Funding opens and closes, and the rules change every year, so the program's own page is the answer, not last year's rule of thumb. Florida Housing publishes its current homebuyer programs and rules on its own site.

Florida Housing lists its current homebuyer programs and their rules on its own site.

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