What is Down Payment Assistance and Why You Should Consider It

Down payment assistance (DPA) programs are designed to help homebuyers with a limited down payment to purchase a home. DPA is typically provided to first-time homebuyers and low-to-moderate homebuyers to cover the initial costs of buying a home. These initial costs include fees such as a lender, title, appraisal, inspection, attorney, and recording.

It is a myth that a homebuyer needs to put down 20% on the purchase of a home.  A 20% down payment is usually required to avoid private mortgage insurance (PMI) which can add to a monthly mortgage payment or to gain a more favorable mortgage loan. However, there are some DPA programs that provide the benefits of 20% down. 

Down payment assistance is needed because it helps people who may not have the financial means to purchase a home. With down payment assistance, many people who would otherwise be able to afford a home may be able to do so. In addition, down payment assistance can help reduce the time it takes to save for a down payment, which can be a barrier for many first-time homebuyers.