Achieve Homeownership with the SmartBuy Shared Appreciation Down Payment Assistance Program

Saving for a down payment can be a significant challenge for many aspiring homeowners. The SmartBuy Shared Appreciation Down Payment Assistance (DPA) Program is designed to help you overcome this hurdle, making the dream of owning a home more accessible. Let’s explore the details of this innovative program and how it can help you secure your new home.

What is the SmartBuy Shared Appreciation DPA Program?

The SmartBuy Shared Appreciation DPA Program offers eligible borrowers down payment assistance of either 2% or 3.5% of the home purchase price or appraised value (whichever is less). This assistance is provided as a second lien on the property with a 30-year fixed rate of 6%.

How Does It Work?

When you sell, refinance, or pay off the loan, the lender receives a percentage of the property's appreciated value. Here are the key components:

• Second Lien Structure: This second lien is not forgivable and must have a distinct loan number separate from the first lien. No additional liens are allowed.

• Appreciation Sharing: When the property is sold, refinanced, or the loan is paid off, the lender receives 40% of the appreciated value for FHA loans or 30% for USDA loans, minus the borrower’s recoverable investment.

• Assumption: The second lien can be assumed by a new buyer if you decide to sell the property.

Key Features of the SmartBuy Shared Appreciation DPA Program

• Loan Amounts and Terms: Borrowers can receive up to 3.5% of the home purchase price or appraised value, whichever is less.

• Eligible Markets: The program is available in most states except New York, Coastal Barrier Reef, Flood Zones, and Oceanfront properties.

• Credit Score Requirements: A minimum representative credit score of 680 is required, with a blended score option available that averages the credit scores of occupying borrowers.

• No Income Restrictions: There are no first-time homebuyer restrictions, and income eligibility follows USDA guidelines.

Benefits of the SmartBuy Shared Appreciation DPA Program

The SmartBuy Shared Appreciation DPA Program offers several advantages, making it an attractive option for many homebuyers:

• Reduced Upfront Costs: This program significantly reduces the amount of money you need to save for a down payment.

• Flexible Qualification: The program’s flexibility regarding income and first-time homebuyer status makes it accessible to a wide range of borrowers.

• Potential for Appreciation: While the second lien involves sharing the appreciation, you still benefit from any increase in the property's value over time.

How to Qualify for the SmartBuy Shared Appreciation DPA Program

To qualify for the SmartBuy Shared Appreciation DPA Program, you need to meet the following criteria:

• Credit Score: Maintain a minimum representative credit score of 680 or qualify with a blended score option.

• Loan Products: The program is compatible with FHA and USDA loan products, subject to specific guidelines.

• Primary Residence: The property must remain your primary residence throughout the term of the second lien.

• Automated Underwriting System: Approval through an automated underwriting system is required, with manual underwriting allowed only for manually downgraded loans.

Conclusion

The SmartBuy Shared Appreciation DPA Program is a powerful tool for aspiring homeowners who need down payment assistance. By providing financial support upfront and offering flexible eligibility criteria, this program makes homeownership more attainable. If you’re looking to buy a home and need help with the down payment, consider the SmartBuy Shared Appreciation DPA Program as a viable solution to turn your homeownership dreams into reality.