Sponsored: Cheat Sheet to Home Buyer Programs in DC

• July 29th 2010

by UrbanTurf Sponsor

Most people were aware of the federal home buyer tax credit, but far fewer realize how many similar opportunities exist specifically for DC residents. The District offers a handful of programs that provide incentives, credits, and tax deferments to home buyers in the city.

Real estate agent Jennifer Myers specializes in these programs and has assembled the following cheat sheet to help DC buyers understand what is available to them.

If you have questions or are interested in taking advantage of any of these programs, contact Jennifer:

Jennifer Myers 202-905-4335 Jennifer@JenniferMyers.com www.jennifermyers.com

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D.C. Homestead Exemption

If you are a homeowner occupant in Washington, DC, you can apply for the homestead exemption which will deduct $67,500 off your assessed value and lower your property taxes.

D.C. Tax Abatement Program

Assuming you qualify, you are exempt from paying transfer and recordation taxes at settlement. This means not only are you exempt from the 1.1% (of the purchase price) recordation tax; but customarily, the seller’s 1.1% (of the purchase price) transfer tax is credited to you at settlement instead of being paid to the District -- a savings of 2.2% off of your closing costs, which pays for almost all of your closing costs! You will also be exempt from paying real property taxes for 5 years beginning the next full tax year after filing. Jennifer will be able to tell you whether you meet the requirements of the program and how to apply and receive these benefits.

D.C. First-time Home Buyer Credit

Initially begun in 1997 and revived periodically ever since, first-time home buyers in the District may be eligible for a one-time tax credit of up to $5,000 off your federal income tax. You could have owned a home elsewhere, but if this is your first home in the District and you meet several other requirements you may qualify.

Home Purchase Assistance Program

The Home Purchase Assistance Program (HPAP) provides interest-free loans and closing cost assistance to qualified applicants. The loan amount is based on a combination of factors, including income, household size, and the amount of assets that each applicant must commit toward a property’s purchase. Loans provided are subordinate to private first trust mortgages. Eligible applicants can receive a maximum of $40,000 in down payment assistance and an additional $4,000 in closing cost assistance. The HPAP 0% interest loan is deferred for the first five years and amortized over 40 years.

Employer Assisted Housing Program

The Employer Assisted Housing Program (EAHP) provides assistance to employees of the District of Columbia government who are first-time home buyers in the District. Employees of District government agencies may be eligible for matching down payment funds up to $1,500 and a deferred loan of up to $10,000. In addition, applicants who apply and qualify for the program receive additional income tax and property tax credits.

Single Family Residential Rehabilitation Program

The Single Family Residential Rehabilitation Program (SFRRP) provides loans and grants with a possible maximum usage of up to $75,000 for home repairs. The funds assist households in financing home repairs that will address DC building code violations, threats to health and safety, and roof repairs or replacement.

• Roof Repair Program
  This program is part of the SFRRP and provides a grant of up to $15,000 to replace the roof. This grant pays for exterior roofing and gutter work only.
   
• Handicapped Accessibility Improvement Program (HAIP)
  This program is part of the SFRRP and provides a grant of up to $30,000 for improvements needed to remove physical barriers within a home for persons with mobility or other physical impairments.
   
• Additional Benefit for Seniors
  Households where the head of household is 62 years or older may have the first $10,000 of their loan provided as a permanently deferred loan. Deferral of additional amounts will be considered on a case-by-case basis.
   

* Note that the Home Purchase Assistance Program, Employer Assisted Housing Program, and Single Family Residential Rehabilitation Program are administered by the Department of Housing and Community Development.

Individual Development Account (IDA) Program

The Greater Washington Urban League’s (GWUL) Individual Development Account savings program (IDA) is designed to assist you in the purchase, down payment or funding toward homeownership. An IDA is a special savings account for people with low to moderate incomes. If you save in an IDA, your money will be matched with donations provided by Countrywide Bank. That means that you can receive another dollar or more for every dollar you save in an IDA. Typically, IDA savings and match money can be used to pay for education or start a small business. However, the purpose of GWUL’s IDA program is to help you purchase a home.

Low Interest Home Loans

Programs such as DC Bond and NACA provide low- or no-interest home loans for first-time home buyers. These programs are income specific and require classes but are well worth the time and effort. Based on your specific situation, Jennifer can help you decide which option is the best fit for your loan needs.

This article originally published at https://dc.urbanturf.com/articles/blog/sponsored_cheat_sheet_to_home_buyer_programs_in_dc/2301.