New Down Payment Assistance Initiative by THRHA
Alaska’s Tlingit Haida Regional Housing Authority (THRHA) has initiated the Down Payment Assistance Program, a significant step towards helping Native families realize their dreams of homeownership. This program is specifically designed to provide financial support for down payments and/or closing costs (excluding prepaid closing expenses) associated with mortgage transactions, thereby reducing the financial barriers to purchasing a home.
Available Assistance: The THRHA Down Payment Assistance Program offers substantial financial aid, providing up to $20,000 to income-eligible applicants. This assistance is structured as a 5 percent fixed-rate second mortgage over a 10-year loan term. Notably, for the first five years, payments are deferred, and during this period, 10 percent of the loan is forgiven annually, provided the property remains owner-occupied. After the initial five years, any remaining balance on the loan is amortized over the remaining term. The program includes a 1.5 percent loan origination fee and a $50 processing fee. It’s important to note that if the home is sold before the loan matures, the loan amount must be repaid.
Eligibility Requirements: To qualify for the THRHA Down Payment Assistance Program, applicants must meet specific criteria. The program is exclusively available to Alaska Natives or Native American tribal members who are first-time homebuyers. Additionally, their annual household income must not exceed 80 percent of the area median income. Prospective borrowers are required to complete a first-time homebuyer education class and demonstrate that their qualification for a bank loan is contingent upon receiving THRHA assistance.
Property Guidelines: Properties purchased with funds from the THRHA program must be the borrower’s primary residence and located in Southeast Alaska. The maximum purchase price for eligible properties is set at $300,000, and mobile homes are not permitted under this program. These guidelines ensure that the program supports the purchase of suitable and sustainable homes for the applicants.
It’s important to note that while seller-funded down payment programs were eliminated in the Housing and Economic Recovery Act of 2008, state and local government agencies, like THRHA, are still authorized to assist borrowers. These agencies provide second mortgages and grants, setting specific requirements for eligibility, such as property location, purchase price, and income limits.
In summary, the THRHA Down Payment Assistance Program is a vital resource for Alaska Natives and Native American tribal members seeking to purchase their first home. By offering significant financial assistance and setting clear eligibility and property guidelines, the program aims to make homeownership more accessible and sustainable for Native families in Southeast Alaska. This initiative represents a commitment to supporting the community in achieving homeownership, which is a crucial step towards financial stability and personal growth.
