Unlocking Your Homeownership Journey with Missouri’s Next Step Program

Overcoming the hurdle of a down payment is often a significant challenge for aspiring homeowners. While many individuals can manage monthly mortgage payments, accumulating the funds needed for upfront costs can be daunting. Recognizing this common barrier to homeownership, the Missouri Housing Development Commission has introduced the Next Step Program to assist individuals in achieving their dream of owning a home.

Available Assistance

The Next Step Program extends a helping hand to eligible applicants by providing them with financial assistance of up to 4% of the first mortgage amount. This assistance is a lifeline for covering a portion or all of the down payment and closing costs associated with purchasing a home. The funds are allocated in the form of a forgivable second mortgage, ensuring that applicants won’t need to repay the loan as long as they maintain residence in the home for a decade. After the fifth year, the mortgage begins to diminish by 1/60 each month, ultimately culminating in complete forgiveness at the end of the term.

Eligibility Requirements

To qualify for the First Place Loan Program, applicants must meet specific criteria. All individuals must satisfy the program’s predetermined income and credit score limits. Household income limits are determined by considering the total gross annual household income for all occupants aged 18 or older residing in the home. This comprehensive definition encompasses various income sources, including wages, overtime pay, bonuses, commissions, child support, alimony, and earnings from secondary employment, businesses, and investments.

Property Guidelines

The program mandates that any property acquired must serve as the primary residence for the applicant, who must occupy it within 60 days of the loan closing. Eligible property types encompass a wide range, including single-family detached homes, one-half duplexes, semi-detached homes, condominiums, townhomes, and manufactured homes on a permanent foundation. Duplexes are also eligible, provided that one unit is owner-occupied, and both units are at least five years old. Additionally, the purchased property must be situated outside the 100-year floodplain. All homes must adhere to the program’s established purchase price limits, which are $303,231 for single-unit properties and $388,245 for two-unit properties.

Income Limits

Income limits vary according to different metropolitan areas within Missouri:

  • Kansas City MSA
    • 1-2 person household: $89,760
    • 3 plus person household: $104,720
  • St. Louis MSA
    • 1-2 person household: $89,400
    • 3 plus person household: $104,300
  • Columbia MSA
    • 1-2 person household: $89,280
    • 3 plus person household: $104,160
  • Jefferson City MSA
    • 1-2 person household: $77,040
    • 3 plus person household: $89,880
  • All Other Areas
    • 1-2 person household: $75,840
    • 3 plus person household: $88,480

These income limits are instrumental in determining eligibility and ensuring that the program serves individuals and families across various income brackets in their pursuit of homeownership.

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