How does DPA work?

For our DPA on government loans, we have multiple options in the form of both a gift and an amortizing 2^nd mortgage. Please see options below:

• Option 1A – Gift: 3% (FHA & VA) and 4% (FHA Only) Down Payment Assistance (1.5% Mortgage Company compensation a/k/a Service Release Premium (SRP))
• Option 1B – Gift: (FHA, VA, & RD): 3.5%, 4.0%, or 5% Down Payment Assistance. (2.5% Mortgage Company compensation a/k/a Service Released Premium (SRP)).

Options 1A and 1B are true gifts with no repayment required or lien on the property. They are based on a percentage of the Total Loan Amount and can be used to fund up to 100% of the Borrower’s cash requirement to close, including the down payment or voluntary down payment, closing costs, pre-paid items and other related Mortgage Loan fees and expenses.

• Option 2 – Hybrid: Gift + Amortizing 2^nd Mortgage: 5% (FHA Only) Down Payment Assistance (2.0% Mortgage Company compensation a/k/a Service Release Premium (SRP))
  • Gift Portion – 2.5% of Total Loan Amount applied to Minimum Required Investment (borrower must pay 1% towards MRI)
    • This portion is a true gift with no repayment required or lien on the property.
  • Amortizing 2^nd Mortgage – 2.5% of Total Loan Amount applied towards Closing Costs and/or Voluntary Additional Down Payment
    • 0% Fixed Interest Rate on 2^nd Mtg.
    • 10 Year Loan Term

See the program summary and income guidelines via the links at the bottom of the page for more detailed information.