Housing grants provide free money endowments for qualified homeowners. Eligible applicants can receive hundreds to thousands of dollars to use towards a new home. Grantees typically use housing grants for down payments, but other programs may help grantees paying for renovations.
Prospective homeowners can apply for housing grants from their local governments and non-profit organizations. There are countless grants available depending on the area where applicants live, their income, and other eligibility factors. A person’s military history, employment, and more could also qualify them for free housing funds.
Financial assistance intends to help low- to moderate-earners as well as first-time homebuyers purchase a home. But a housing grant does not cover 100 percent of a home’s purchase price.
Down payment assistance programs (DPA) pay for a portion of the home’s purchase price. While homeowners pay for a portion of the purchase price each month through their mortgages, the down payment is due upfront.
The percentage of down payment needed at the time of closing can vary. Decades ago, 20 percent was the standard. However, rising housing costs have made that amount nearly unaffordable to most people.
Consider the following percentages for a $200,000:
- 20 percent is $40,000
- 10 percent is $20,000
- 6 percent is $12,000
- 3 percent is $6,000
The average down payment is 6 percent of the purchase price. Many families – especially low-income households – may find that saving for a five-figure down payment is hard to do while paying rent and other living expenses.
Similarly, homeowners can apply for housing grants to make major renovations to their property. Companies, such as Home Depot, provide funding for homeowners who need to make repairs to their homes, such as roof repair and other projects that affect the safety of occupants.
Additionally, homeowners at risk of foreclosure can seek financial assistance to help stop them from losing their homes. For example, the COVID-19 Mortgage Relief program can help single-family homeowners to pause their monthly mortgage requirements. Housing grants can help you to purchase, renovate, or keep your home. If you need financial assistance, click the next slide to find out about qualifying for grants.
By Melanie Henson –