Many Canadians and first-time home buyers dream of being able to own their home. For some this may seem impossible with housing prices and interest rates on the rise. First-time home buyers in Nova Scotia that are struggling to save up enough money are able to achieve their dream of homeownership. The Down Payment Assistance Program helps homeowners that would otherwise be unable to afford a home.
What is the Down Payment Assistance Program?
This program helps home buyers who wouldn’t be able to afford owning a home without a little help. This program has been helping hundreds of homeowners across the province achieve their dream of homeownership since 2017. During the first year of the program, it assisted 153 first-time home buyers with a funding of almost $1.3 million. The program is designed to assist homeowners that have a humble income and have been pre-approved for a mortgage, who may need some help in covering their required down payment. Participants of the program can apply for an interest-free loan that is up to five percent the purchase price of the home. The program is based upon a first come, first served basis.
This means that eligible participants will be assisted based upon the order of their application submission. Any unused funds will be redistributed to the different regions across the province. Moreover, during the 2019/2020 fiscal year, the province has made available $1.05 million in funds to be loaned out to eligible participants. $250,000 has been budgeted to cover interest costs and carrying charges.
Canadians looking to participate in the Down Payment Assistance Program have to meet a few criteria. Borrowers looking to participate must be first-time home buyers and have a good credit report. With that, their total household income must also be less than $75,000. They also must be pre-approved for a mortgage by a recognized financial institution and the property must be located in Nova Scotia. Moreover, the purchase price of the home must not exceed $280,000 in the HRM. This is reduced to $150,000 for the rest of the province.
How it works!
The Down Payment Assistance Program is pretty flexible in terms of how homeowners can pay back the loan. The loans that homeowners are awarded are interest free. They can range anywhere from $7,500 to $14,000, depending on the income level of the participant. Homeowners that have a higher income will generally be awarded a smaller amount of money compared to those that have a lower income level. The loans are repayable for a 10-year period. Homeowners may also waive their payments in the first year. This gives them some leniency in when they have to pay them back. While they have lenience with when they have to pay off the loan, the money MUST go towards the down payment. Participants cannot use the money for financing or closing costs as it goes against the purpose of the program.
Nova Scotia’s Down Payment Assistance Program has helped hundreds of Canadian achieve their dream of homeownership. Nova Scotians that come from a household with a modest income can use this program to afford the down payment on a home. If you’ve been dreaming of owning a home, give us a call or get in touch with us here!