First time home buyers in all 50 states have a variety of low-cost mortgage and down payment assistance programs to help them acquire their first home. In Maine, those programs are administered by MaineHousing, an independent state agency that acts as a bridge between private and government first time home buyer programs that provide funding for housing. MaineHousing estimates that it will help more than 90,000 families and individuals just in 2011 alone. In addition to first time home buyer assistance, the agency also provides assistance to the homeless, rehab assistance, renter’s assistance, and home energy assistance.
The Gift of Green
The Gift of Green program is a down payment assistance program which includes a home energy audit. The purpose of the program is to encourage home buyers to look for properties that are already energy-efficient or could be reasonably upgraded. The program provides a grant for down payment and closing costs of up to $2,000. Included is a $500 coupon to pay for the energy audit.
The Gift of Green is a grant rather than a loan, so it does not need to be repaid. The program can be used in conjunction with the state's Purchased Plus Improvement Option which funds home improvements that improve energy efficiency. There are some instructions that apply to this program.
First Home Program
The First Home Program is one that provides low interest mortgages to first time home buyers or those who have held no ownership interest in the home three years prior to application. Interest rates are lower than the standard rates offered under conventional mortgages. Other benefits of the program include options for either no points or low points, additional down payment assistance through the Gift of Green program, financing for mobile homes under certain circumstances, and the ability to include the cost of home improvements in the mortgage amount.
There are strict eligibility requirements based on income, but most Maine residents will be eligible to some degree. The program also provides an option which protects home buyers against unemployment by covering their payments during that term. That assistance becomes a secondary low interest loan which must be paid off when the first mortgage is satisfied.
Other Home Buyer Programs
MainHousing offers three other loan programs not specifically aimed at first time home buyers, but which such buyers can still apply for. They are very specific in their scope, so the vast majority of home buyers will not qualify. These programs are as follows:
- Operation New Home - specifically targeted at current and former military personnel and their families
- Disaster Assistance Loan Program - offers rehab loans or replacement loans for victims of natural disasters
- Indian Housing Mortgage Insurance Program - provides loan guarantees and mortgage insurance to lenders who are willing to loan for purchases of homes on designated tribal lands
The federal government provides first time home buyers assistance in the form of HUD grants delivered to the states. The various states then disburse this money through a variety of programs which can vary in scope and size. Such programs are not necessarily available year-round, and most are even suspended from time to time until new funds are available. In addition, many local and county agencies as well as nonprofit organizations provide programs in the form of grants. Below is a list of programs that HUD lists as currently active in the state of Maine. This information is subject to change:
- Maine Coastal Enterprises Inc Individual Development Account Program (IDA)
- Maine Multi Counties Washington Hancock Community Agency Set Aside Funds Program (SAP)
- York County Community Action Corporation Home-Ownership Program