Need Help With A DownPayment?
What Is The Down Payment Assistance Loan?
The Down Payment Assistance (DPA) product provides assistance for home buyers who are purchasing a single family home in the Anchorage Borough, Kenai Peninsula Borough or the Matanuska-Susitna Borough. Applicants using this product will be expected to occupy the home as their primary residence.
Loan amounts for the DPA vary and may not exceed 20% of the purchase price with a maximum of $60,000. This loan is considered a second mortgage so applicants will also need to meet first mortgage loan-to-value (LTV) requirements from their primary lender. The DPA Loan currently offered has a 4% fixed interest rate over a 30 year term with an Annual Percentage Rate (APR) of 4.083%. Interest rates are subject to change.
The DPA is designed to increase home ownership and affordable housing opportunities primarily for eligible applicants in the Cook Inlet Region area. A benefit of this loan product combined with a first mortgage loan is the potential to avoid monthly mortgage insurance which lowers the borrower’s overall housing payment. This benefit helps our families save money and have increased buying power.
What Are The Steps?
- Prequalify with an AHFC approved lender for the first mortgage
- Apply for and Receive income eligibility letter from Cook Inlet Lending Center
- Schedule and obtain a Certificate of Completion of the AHFC HomeChoice Program
- Shop for a home and execute a purchase contract
Download the Down Payment Assistance Application
Current DPA Income Limits
The income limits are posted and will become effective for all applications received beginning on or after May 8, 2017. Applications and income eligibilities that have already been issued are not affected by this change. Moving forward from May 8th, the Cook Inlet Lending Center will follow the new income guidelines posted below. Income limits are subject to change.
Am I Eligible?
- Household income must be at or below 120% Area Median Income (AMI) *See our Income Limits tab above
- Borrowers who have a minimum credit score of 640.
- Borrowers must show evidence of two (2) months of reserves after closing. Reserves are calculated by multiplying 2 months of a Principal, Interest, Taxes and Insurance (PITI) payment of the housing payment. Reserves may come in the form of checking, savings, investment or retirement accounts.
- Borrowers may not have had a foreclosure or bankruptcy in the past six (6) years.
- Borrowers will demonstrate the ability to afford their mortgage payments: first mortgage debt-to-income ratio and total debt-to-income ratio should be in the range of 30% and 40% respectively.
Cook Inlet Lending Center will ultimately determine your eligibility for the loan after you have been pre-qualified for a first mortgage by an AHFC approved lender.
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