Proposed Downpayment Toward Equity Act and its Potential Impact on First-Time Homebuyers
- Author: Ben Reilly
- Posted: 2024-06-18
As of now (June 17th, 2024), the bill hasn't been passed yet, but it's a significant part of President Biden’s budget proposal for fiscal year 2024. While we await its potential approval, let’s dive into what this program could mean for aspiring homeowners.
About the Downpayment Toward Equity Act
This forward-thinking bill proposes up to $25,000 in aid to help cover the initial costs associated with purchasing a home, including down payments, mortgage closing costs, or securing lower mortgage rates. Unlike typical support that comes in form of a tax credit, this grant would provide cash directly at the time of closing, giving immediate financial relief.
The bill specifically targets to bridge the homeownership gap among economically and socially disadvantaged groups, including those with disabilities and people of color. If passed, the program will be managed by the U.S. Department of Housing and Urban Development (HUD), alongside selected community non-profits and local housing agencies.
Current Status
As of mid-2024, the Downpayment Toward Equity Act is still making its way through Congress and isn't yet law. This means the $25,000 grant isn't available right now. However, given its reintroduction in President Biden’s budget for 2024, there’s hope it could pass in some form by the end of the year.
Who's Eligible?
To qualify for this grant, applicants must be first-time, first-generation homebuyers. This means neither you nor your immediate family (like parents or legal guardians) have owned a home in the last three years.
There are income limits to consider, which adjust based on your local area's median income, to ensure the program aids those it’s intended to help. The grant can be applied to a variety of property types and mortgage loans, adding to its appeal.
Other Assistance Options Available Now
While the Downpayment Toward Equity Act is pending, there's a wealth of first-time homebuyer grants and downpayment assistance programs available across the U.S. These initiatives offer various forms of aid, from cash grants to help with closing costs and mortgage insurance, making now as good a time as any to explore your options.
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