Down Payment Assistance for Healthcare Workers | Unlocking Homeownership

Last Updated on September 19, 2024 by Luke Feldbrugge

Down payment assistance for healthcare workers can provide a way to save some money on the purchase of a new home. If you’re exploring down payment assistance (DPA) options, this post provides valuable insight on money saving loan types, grants and home buying programs to assist with purchasing a home.

Key Takeaways

• Federal, state and local programs provide down payment assistance and grants that can also include forgivable loans, deferred payment loans, low-interest loans, and matching savings plans.
• Special government-backed loan types like FHA, VA, and USDA loans offer low to no down payment requirements.
• Homes for Heroes offers additional savings (in addition to down payment assistance programs) on home purchases for healthcare workers.

What Down Payment Assistance is Available for Healthcare Workers?

A common question for many healthcare professionals, especially early in their career after accumulating debt from their education and certifications, is how can I afford the down payment for a new home?

Healthcare workers looking to buy a home can access a variety of down payment assistance programs designed to ease the financial burden of purchasing a property. From federal and state grants to forgivable and low-interest loans, these initiatives support the needs of medical professionals in purchasing a new home and saving them money in the process.

HUD U.S. Department of Housing and Urban Development

The federal government does not give housing grants to individuals, but it does award government funding for a new home to states and certain municipalities who distribute the funds to local residents. Here is the resource they provide about government funding for a new home.

State and Local Down Payment Assistance

Many states, local governments, and nonprofit organizations offer grants and low-interest loan programs, and some are tailored to healthcare professionals. These programs are definitely worth investigating.

Check out our blog post that covers the down payment assistance programs and grants in each U.S. state. Keep in mind there may be other local programs that are not as well known, and this is where working with a real estate and lending professional who knows about local options can be helpful.

Below are general options that may be available in your community. Here we provide a basic overview, but if they are available in your area, please know each will likely have their own specific requirements.

• Grants – Funds that do not require repayment. Grants are exceptionally attractive for this reason. They are typically provided by state or local governments and nonprofits. They often carry specific qualification criteria, such as a requirement to reside in the home for a predetermined duration. An example of a national grant program is the National Homebuyer Fund.
• Forgivable Loans – These are designed to be waived under certain conditions, such as maintaining residence in the property for a set amount of time. If you decide to sell the property before the loan’s term expires, you might be obligated to repay some or the entire amount of the loan.
• Deferred Payment Loans – Deferred payment loans do not require immediate repayments, deferring all payments until the property is sold, refinanced, or the mortgage is fully paid off. While this option is appealing, it’s important to note that interest accumulates over time, potentially resulting in a substantial final payment. The strategy behind these loans is to leverage increased home equity over time to cover the loan and its accrued interest, offering an initial leg-up for securing your down payment.
• Low-Interest Loans – Offering a more affordable repayment plan, low-interest loans reduce the financial burden with lower interest rates. It’s important to remember these are still traditional loans contributing to your total debt and monthly financial obligations. Such loans are commonly available through private lenders or banking institutions. It’s advisable to consult with your mortgage lender before proceeding, as the amount of debt you incur for the down payment and mortgage is a key consideration for them.
• Matching Savings Plans – Matching savings plans incentivize saving for a down payment by doubling the amount you save within the program’s confines. These initiatives encourage disciplined savings but come with stringent eligibility requirements and caps on the matching contribution. For instance, the FDIC’s Individual Development Accounts offer matched savings but require a commitment of 12 to 36 months to fulfill, which may not suit those in a rush to purchase.

Zero Down and Lower Down Payment Mortgage Loan Programs

These government-backed mortgage loan programs are loan guarantees that greatly reduce or completely eliminate your down payment.

• FHA Loan – FHA loans offer a lower down payment option, as low as 3.5%. This government-backed loan guarantee from the Federal Housing Administration is often appealing to homebuyers with low to moderate-income earners who typically have lower credit scores.
• VA Loan – Even though you’re looking for down payment assistance for healthcare workers, if you are an active duty service member or a veteran of the U.S. Armed Forces, you may qualify for the VA loan. The VA loan features no down payment! Not to mention many other benefits. Take advantage of it if you can.
• USDA Loan – Like the VA loan, the USDA loan offers no down payment. It is intended to help those interested in purchasing a home in rural areas. If you’re planning to hunt for a house outside the city, this may be worth looking into further.

Down Payment Assistance Eligibility for Healthcare Workers

Each down payment assistance program has its own qualification criteria. There will likely be profession-specific requirements. Generally, you will likely need to be a first-time homebuyer, have a low-to-moderate income, and be purchasing a primary residence. You may also need to complete a homebuyer education course.

Homes for Heroes Offers $3,000 Average Savings

Homes for Heroes helps healthcare workers purchase a new home and save money. Unlike other home buying programs intended for healthcare workers, Homes for Heroes and their real estate agents and loan officers work together to provide savings IN ADDITION to the established state and local down payment assistance that everybody can offer you.

“Homes for Heroes was a blessing for me. The money I got back has helped me with the expenses I have after purchasing the home. I also appreciate being recognized by the program for being a nurse.” – Sheila in California

“A must-do for anyone in healthcare looking to buy a home. I could not have asked for a better real estate agent to connect with and the reimbursement check was very helpful for our first few home improvement projects!” – Cole in Michigan

Homes for Heroes agents and lenders offer down payment assistance for healthcare workers PLUS MORE!

When you work with Homes for Heroes local real estate and mortgage specialists to purchase a new home, you can save an average of $3,000 IN ADDITION to any of the other down payment assistance opportunities that are available (please note down payment assistance programs typically have specific qualifications and criteria that must be met).

The specific savings provided by Homes for Heroes is awarded after closing on the home, and it’s given in the form of a check so you can spend it on new furnishings, home updates, or anything else you may need.

Sign up to speak with a member of our team. There’s no obligation. We will contact you to learn how Homes for Heroes can best serve your needs.