Sense & Centsibility Blog
Housing

Take Advantage of Homebuyer Assistance Program

Thursday, August 3, 2017 - 10:31

As a HUD-approved housing counseling provider, LSS Financial Counseling sessions fulfill requirements for a homebuyer assistance program. LSS is not funding the program, but we will help you navigate the opportunities available, including the HOM Down Payment and Closing Cost Assistance.

HOM Down Payment and Closing Cost Assistance

Homeownership Opportunity Minneapolis (HOM) Down Payment and Closing Cost Assistance is available to homebuyers purchasing a home in Minneapolis.

  • $7,500 for borrowers with household incomes at or below 80% of area median income (currently $65,700 for a household of four)
  • $5,000 for borrowers with household incomes greater than 80% of area median income up to a maximum income of 115% of area median income (currently $98,670 for household of four)
  • Homebuyers must complete homeownership and financial counseling through a designated HOM Financial Counselor.  Homebuyers must have a financial counseling certificate that predates their purchase agreement and must also complete homebuyer education to be eligible to apply.
LSS Financial Counseling is a designated provider of these financial counseling sessions for the HOM program. To schedule your FREE session, call us at 888.577.2227 M-F from 8am-5pm.

Homebuyer Education

Taking a first time homebuyers' education class is always a good idea to help you be prepared for homeownership. In Minnesota, the Minnesota Homeownership Center is the best resource for finding classes, pre-purchase counseling services, and a wealth of valuable tips and information.  To find providers in another state, visit HUD’s website.

Also, here are 5 helpful tips to prepare for home ownership:

1. Check your credit

Take care of any issues and aim for a credit score of 700. If your score is lower than 700, work on building up your credit before attempting to obtain a mortgage so you can get a good interest rate on your loan. Dispute errors and take care of any issues, like old debts. You have to pay for your score, but you can get your credit report for free once a year from all 3 credit bureaus from AnnualCreditReport.com.

2. Be realistic about timing

Don’t rush into purchasing a home. Make sure you have money saved up at least for moving expenses, items you need to furnish your home, and hopefully a down payment. Plus, taking your time will allow you to improve your credit if needed. The key here is to start planning as early as possible, preferably about 2 years in advance.

3. Choose your location wisely

Before picking out your house, find the best location for you. Think about property taxes in the area, your distance to work, and where your new home is in relation to the grocery store or your child’s school for example. Planning like this will help you save a lot of money.

4. Think ahead about being a homeowner

Determine what changes you may need to make in your spending, what you will be paying in homeowner’s insurance, utilities, and potential maintenance.

5. Don’t be house poor

Determine your budget ahead of time so you know what you can afford. Buying too much house will only set yourself up for failure. An unaffordable home can lead to accruing more debt or worse, missing mortgage payments and even foreclosure. A good goal is for your mortgage payment to be a maximum of 25% of your take home pay.