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Arlington Offers Moderate Income Buyers a Deferred, No Interest Loan

Arlington County just got more affordable for first-time buyers with its Moderate Income Purchase Assistance (MIPAP) program!

If you’re a single person with a maximum household income of $61,840, a couple with $70,640, or a three-person family with $79,440, then you could qualify for assistance and make this wonderful community your home.

The Moderate Income Purchase Assistance (MIPAP) program provides homebuyers with a deferred-payment, no-interest loan that covers up to 25% of the home’s purchase. The loan may be used to cover a portion of the down payment and all closing costs.

The maximum purchase price is $500,000; and the maximum loan amount is $112,500. Single-family homes, townhouses, condos and cooperatives are eligible.

Prospective buyers will need to go through a pre-approval process that includes a 6-hour, in-person education class.

Funds are available on a first come, first served basis, but those who work in Arlington or currently reside in the county will receive preference for these MIPAP funds.

The MIPAP loan acts as a second mortgage; and the first mortgage must be a conventional loan from a lender approved by VHDA (Virginia Housing Development Authority).

Since buyers will have no monthly loan payments over the course of the loan, when it comes time to sell or refinance, the loan must be paid back if the appraisal determines the property has increased in value. Buyers also will have to pay a proportionate share of the net appreciation of the home (up to 25%).

Homebuyers must meet the following eligibility criteria:

  • Be a first-time homebuyer or a homebuyer who has not owned a home in the previous 3 years;
  • Applicants must not be under contract to purchase a home at the time of MIPAP Pre-Approval Application;
  • Have a household income at or below 80% of the Area Median Income for their family size;
  • Have a minimum credit score of 660;
  • Have a minimum down payment of 1% of the purchase price;
  • Secure first trust lender financing; and,
  • Ratios of housing expenses to income and total debt to income must not exceed 45%.

Potential MIPAP borrowers must complete the following steps

  • Attend a 6-hour VHDA Homebuyer Education Course and obtain a certificate of completion; and
  • Obtain a good faith pre-qualification letter from a VHDA-approved first trust lender willing to provide a conventional first trust mortgage; and,
  • Complete and submit the entire MIPAP Pre-Approval Application Packet

The application process could take up to 45 days to complete. If pre-approved, the applicant will receive a maximum loan amount to be added to the 1st trust amount for purchase of a home. The Pre-Approval certificate is valid for 6 months.

We can connect you to a wonderful lender that understands the program, can determine if you qualify, and get your application going. You can make your homeownership dreams come true in Arlington County even more easily now!

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