First mortgage and down payment assistance for 1-4 unit homes
Buying a home is a daunting process, and Finance New Orleans knows that securing a mortgage and supplying a down payment on a home is a huge obstacle to overcome. That’s why we’re here to help you own your piece of New Orleans by providing a first mortgage paired with down payment assistance options to suit your needs.
Whether you’re a first-time homebuyer or an experienced homeowner looking to buy a new home, a first mortgage and down payment relief are never far away.
- Save money that will help you qualify for the first mortgage.
- Keep savings that can be used for other household needs, like purchasing appliances or buying furniture.
- Start with more equity in the home.
Down Payment Assistance
WHAT IS IT?
This product is a 30-year VA, FHA, Fannie Mae or Freddie Mac first mortgage with a zero-interest, forgivable second mortgage (equaling 2-5% of your approved home loan) to help with your down payment.
HOW DOES IT WORK?
Once you qualify for a first mortgage, you’ll receive a sum of money that will be forgiven, but you must remain in the home for at least 3 years.
Eligibility & Terms
- Individuals or families
- Household income below $99,000
- Credit score above 660
- Total debt load less than 45% of income
- Earn Homebuyer Education Class Certificate
- Qualify for first mortgage with participating lender
Where / what:
- Orleans Parish
- 1 to 4 unit primary residence
- Move-in ready home
Review the choices below to determine the best first mortgage and down payment assistance option that suits your needs and eligibility.
Resources & FAQs
In order to qualify for the program benefits, homebuyers are required to apply for a mortgage at any one of our participating lenders.
What is The Green Mortgage Program?
The Green Mortgages Program offers a first mortgage down payment assistance to qualified buyers who want to own a home in New Orleans. Homebuyers can choose the down payment assistance in the form of a forgivable loan at 2-5% of the first mortgage. If you receive the forgivable loan, you must remain in the house for 3 years for the second mortgage to be fully forgiven.
How do I apply?
Finance New Orleans’s mortgages are originated through our Participating Lenders. If you have a banking relationship with one of these lenders, you may choose to work with them or select another from our list. The lender will be able to guide you on the financial documentation you need to provide and the type of loan product that you would qualify for. If you are a first-time homebuyer, you must also complete a homebuyer education and training course. The course may be taken on-line or in-person in conjunction with eHome America and the Participating Training Organizations.
What is the minimum required credit score?
The minimum required score is 660 for FHA, Fannie Mae, Freddie Mac, and VA loans.
What are the income requirements?
The income limit is $99,000 regardless of household size for FHA and VA. Income limits for Fannie Mae are family specific.
What kind of home can I use the down payment assistance to purchase?
The home must be used as your primary residence but the type of home varies based on the loan product you choose. You may purchase a 1 to 4 units (detached or attached), condos or townhomes under the FHA, VA, and Fannie Mae loan products. However, you may only purchase a 1-unit home under Freddie Mac’s loan product. Manufactured housing, mobile, recreational, seasonal or other types of vacation or non-permanent homes are not permitted.
Can I buy a fixer-upper?
Only homes that are move-in ready are eligible for financing in The Green Mortgages Program.
Can I buy a double and rent out one side of the home?
Yes. If you choose a FHA or VA loan, you may purchase a double as long as you live in one side as your primary residence. Fannie Mae loans allow the purchase of homes up to four units as long as you reside in one unit as your primary residence.
Do I have to be a first-time homebuyer?
You do not have to be a first-time homebuyer. However, for the Freddie Mac loan product, you cannot own other property at the time of closing.
Do I have to complete homebuyer training?
If you are a first-time homebuyer, you must complete homebuyer training. The course may be taken on-line through eHome America in conjunction with the Participating Homebuyer Training Organizations or in-person at one of their local classes. The course must be completed prior to loan closing.
What are the terms of the 1st mortgage?
The first mortgage is a 30-year, fixed rate, amortizing loan with 360 level monthly payments. The interest rate is subject to current market conditions and changes daily. Follow FHA Maximum loan limits for maximum loan amounts. VA first loan limits also apply.
What are the terms of the down payment assistance?
Down payment assistance is offered as a 3-year deferred loan that is forgiven at the rate of 1/3 per year provided that the borrower is not in default and resides in the home as their primary residence for the duration of the 3-year period.
How may I use funds from the down payment assistance?
The proceeds may be used for down payment, closing costs, prepaid, upfront private mortgage insurance and other related program and mortgage loan fees and expenses. The second mortgage proceeds may not be used to pay off debt.
*All of these questions are subject to current guidelines.
Questions or Comments on the Green Mortgages Program?
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