metroDPA offers funds available for the purchase of a home if you are a resident or direct resident of someone who lived in a Denver redlined area between 1938-2000. If eligible, up to $25,000 can be used toward the purchase of a home in approved cities/counties throughout the front range. These funds are to help increase homeownership in areas of color that have been historically targeted by discriminatory lending practices like redlining, which happens when a banking institution or related provider denies loans or restricts services to certain areas of a community or neighborhood.
The metroDPA social equity program is based on no interest, forgivable second liens that don’t need to be paid back if the recipient occupies the residence for at least three years.
Step Two: If the address where you or your direct descendants lived during that time are in fact in a redline area, you then will need to submit an application directly to metroDPA. Use the link below to get started. If you are eligible for the program, they will email you an approval.
Step Three: Upon receipt of approval, submit the document provided by metroDPA to your loan officer.
Requirements:
Borrowers make below $188,250
Minimum credit score of 640
< 80% of average median income
Borrowers may receive $25,000 and charter level mortgage insurance
Loan types include FHA, VA, USDA And Conventional; loan limits vary by county
$600,000 purchase price
Required down payment is $18,000
Estimated closing costs are:
Points metroDPA charges (1.250) = $7275
Escrow set up = $2650
Processing and underwriting costs = $3480
Closing Cost Total: $13,443
Down payment: $18,000
CASH TO CLOSE: $31,443
However, with the social equity down payment assistance of $25,000 your new estimated cash to close is $6,443!
Factoring in the forgiveness of the assistance amount after three years makes this program a substantial contributing element in increasing home ownership in communities where housing discrimination previously occurred. This program also strengthens the commitment that race and ethnicity no longer predict housing and lending results.
Interested consumers must act diligently, as funds are limited each year.