Are you a North Carolina First-Time Homebuyer? Discover Grants and Assistance Programs That Can Help

It can be difficult to save up enough money for a down payment. That’s why statewide and local organizations and governments in North Carolina have created these first-time homebuyer programs to help its residents pay for down payment and closing costs.

The goal of these programs is to help low- and moderate-income residents in North Carolina achieve their dream of owning their own home. However, these programs also come with a variety of eligibility requirements: Some have income requirements, some require the buyer to purchase a home in a specific location, some set purchase price limits, and some have other requirements.

If you’re looking to purchase a home in North Carolina, take a look at these closing cost and down payment assistance programs to see if you’re eligible.

NC 1st Home Advantage Down Payment

The NC 1st Home Advantage Down Payment program provides up to $15,000 in down payment and closing cost assistance that is offered in conjunction with an NC Home Advantage Mortgage. This is a statewide program run by The North Carolina Housing Finance Agency that provides eligible homebuyers with affordable, fixed-rate, 30-year mortgages in combination with down payment assistance.

Who is Eligible?

To be eligible for this program, you must be a first-time homebuyer, a military veteran, or buying a home in a targeted census tract. You must also have a credit score of 640 or higher, be a legal U.S. resident, and meet income limit requirements based on the number of people in your household and the county in which you want to buy. For example, if you wanted to purchase a home in Alamance County and had four people in your household, you could earn up to $109,000 per year and qualify.

What Types of Properties are Eligible?

Single-family homes, townhomes, condominiums, and new manufactured homes located in North Carolina are eligible. If homebuyers are purchasing a new manufactured house, they will need a minimum credit score of 660. Properties must meet sales price ceilings that are set by the county. For example, the sales price limit in Alamance County is $480,000.

How Does it Work?

You can apply for this program through a participating lender.

Is It A Grant Or Loan?

This is a 0%, deferred second mortgage that is forgiven at 20% per year, starting in year 11. It is fully forgiven after year 15. If a homebuyer sells the home or refinances the first mortgage within the first 15 years of homeownership, they will have to repay the remaining unforgiven balance of the down payment assistance.

What’s Good About This Program?

This program targets borrowers of a particular loan program. If you’re arranging your first mortgage through this loan program, and you meet the other eligibility requirements, it could be beneficial to apply for this down payment assistance as the applicant pool could be smaller than with other programs.

Rebuild NC

Rebuild NC provides up to $20,000 or 20% of the purchase price (whichever is less) in down payment and closing cost assistance for first-time homebuyers, and up to $30,000 or 30% of the purchase price for first-generation homebuyers. If you haven’t owned a home in the last three years, you can qualify for this first-time homebuyer assistance.

Who is Eligible?

First-time and first-generation homebuyers with an annual income that doesn’t exceed 120% of the area median income for the county in which they are purchasing can qualify for this loan. At least one member of the household must be a U.S. citizen and household liquid assets can’t total more than $30,000. In addition, homebuyers must complete a homeowners education and financial counseling course and have a pre-approval letter for a fixed-rate mortgage.

What Types of Properties are Eligible?

To qualify for this program, the home you’re purchasing must be located in one of the 16 counties identified by HUD as most impacted by hurricanes Matthew and Florence. This must be your principal residence and the seller can’t be someone who is a relative.

How Does it Work?

Email the program at: HAP.support@ncdps.gov to apply.

Is It A Grant Or Loan?

This is 0% interest loan that is fully forgivable after three years. If the homeowner sells the home or refinances the loan within 3 years, they will have to repay the assistance.

What’s Good About This Program?

This program is particularly beneficial for first-generation homebuyers and is one of the only programs that targets this demographic.

Financial Pathways of Piedmont

Financial Pathways of Piedmont provides between $10,000 and $50,000 in down payment and closing cost assistance, depending on the source of the first mortgage loan.

Who is Eligible?

If your first mortgage is a USDA Section 502 loan, you could be eligible for up to $10,000 in assistance. If you’re combining your assistance with an NCHFA Home Advantage Mortgage, you could be eligible to receive between $20,000 and $50,000 in down payment and closing cost assistance.

How Does it Work?

Contact the program directly through the website for more information.

Is It A Grant Or Loan?

It’s a loan. This is a 0% interest second mortgage that matches the term of the first mortgage. The homebuyer must repay the assistance:

• When they sell or transfer the home,
• When the home no longer serves as their principal residence,
• Or when the first mortgage has been refinanced or paid off.

Contact the program for more details at 336-773-0286.

What’s Good About This Program?

This program targets borrowers who are securing specific types of loans for their first mortgage. If you’re planning to use either a USDA Section 502 loan or a NCHFA Home Advantage Mortgage, this could be an advantageous program.

Wake County Affordable Home Ownership Program

The Wake County Affordable Home Ownership Program provides up to $50,000 in down payment and closing cost assistance for first-time homebuyers.

Who is Eligible?

First-time homebuyers with a credit score of at least 640 and a household annual income that does not exceed 80% of the area median income for the number of people in their household (for a family of four that’s $90,650 per year) are eligible to apply. Homebuyers must take a homebuyer education course and complete a counseling session.

What Types of Properties are Eligible?

New and existing homes located in the following eligible cities and townships are eligible for this program: Apex, Fuquay-Varina, Garner, Holly Springs, Knightdale, Morrisville, Rolesville, Wake Forest, Wendell or Zebulon.

How Does it Work?

Homebuyers must apply for the program through an approved lender.

Is It A Grant Or Loan?

This is a forgivable first-time homebuyer loan with a 0% interest rate. Contact the program directly through their website for more details.

What’s Good About This Program?

At a $50,000 maximum assistance award, this program has a relatively high ceiling. If you meet all of the eligibility requirements, this might be an advantageous program.

Durham Down Payment Assistance

Durham Down Payment Assistance provides up to $80,000 in down payment and closing cost assistance for first-time homebuyers or those who haven’t owned a home in the last three years.

Who is Eligible?

Homebuyers are eligible to apply if they make an annual income that’s 80% of the area median income or less (that’s up to $80,900 per year for a family of four), complete the homebuyer education course, and plan to use the property as their primary residence.

What Types of Properties are Eligible?

Contact the program directly for more information about property eligibility.

How Does it Work?

Homebuyers must pair this assistance with a fixed-rate, 30-year mortgage and apply for the program through a participating lender. You can find a list of participating lenders on the program website.

Is It A Grant Or Loan?

This is a 0% interest, 15-year forgivable loan.

What’s Good About This Program?

This program offers the highest amount of possible assistance. If you meet the eligibility requirements, this is definitely a program you should consider, especially if you plan to stay in your home long term.

Raleigh Homebuyer Assistance Program

Two programs are available for homebuyers through the Raleigh Homebuyer Assistance Program:

• The Homebuyer Assistance Program offers up to $45,000 in down payment, closing cost, and financing gap assistance.
• The Enhanced Homebuyer Assistance Program offers up to $65,000 in down payment, closing cost, and financing gap assistance.

Who is Eligible?

Homebuyers with an annual income that is equal to or less than 80% of the area median income (for a family of four that’s an income limit of $90,650) are eligible. Program participants must attend a homeownership education course and a counseling session.

What Types of Properties are Eligible?

New and existing single family homes, townhomes, and condominiums located within Raleigh city limits are eligible for both programs. The home must be used as the homebuyer’s primary residence. There are additional property eligibility requirements for each program:

• The Homebuyer Assistance Program has a maximum sales price threshold of $371,000.
• The Enhanced Homebuyer Assistance Program has a maximum sales price threshold of $450,000. In order to be considered for the Enhanced Homebuyer Assistance Program, the home must be located in a targeted area. You can check this map to see if your home is eligible.

How Does it Work?

Homebuyers must apply for the program through an approved lender. When the homebuyer receives pre-approval for their first mortgage, the lender will apply for the program on their behalf if they’re eligible.

Is It A Grant Or Loan?

This is a 0% interest-deferred loan that will be paid back once the homebuyer sells their home or no longer uses it as their primary residence.

What’s Good About This Program?

This program offers a high level of assistance, particularly if you’re buying a home in a targeted area.

Housing Connect GSO’s (Greensboro) Homebuyer Assistance Program

The Housing Connect GSO’s (Greensboro) Homebuyer Assistance Program provides down payment and closing cost assistance for first-time homebuyers or those who haven’t owned a home in the last three years. The amount of assistance will depend on the household’s annual income.

Who is Eligible?

There are three types of borrowers who are eligible for this type of assistance:

1. Households with a maximum annual income of 80% of the area median income can qualify for up to $15,000. An additional $5,000 may be possible if the buyer is purchasing a home in an area zoned for redevelopment or a designated reinvestment area. Only residents of Greensboro are eligible for this assistance.
2. Homebuyers with careers that qualify them as “public heroes,” and that have a household annual income that is 120% of the area median income, could be eligible to receive up to $15,000 in assistance. An extra $10,000 may be possible if they buy a home in an area that has been targeted for redevelopment or reinvestment. Public heroes must be an employee of Greensboro City, Guilford County, Guilford County schools, active duty military, or a military veteran.
3. Homebuyers with household incomes between 80% and 120% of the area median income can be eligible to receive up to $10,000 in assistance; a $5,000 bonus is possible if the buyer is purchasing a home in an area zoned for redevelopment or designated a reinvestment area.

What Types of Properties are Eligible?

New and existing homes located within Greensboro city limits that will serve as the homebuyer’s primary residence are eligible. Homebuyers participating in the 80% area-median income program must purchase a home that was built after 1978.

How Does it Work?

Borrowers must apply for the assistance through an approved lender. Contact Housing Consultants Group for more program information.

Is It A Grant Or Loan?

Contact the program directly for more details.

What’s Good About This Program?

This program has three thresholds for eligibility so it can serve a larger population. Since there are three thresholds, it could increase a homebuyer’s chance of receiving approval for assistance.

House Charlotte Assistance Program

The House Charlotte Assistance Program provides financial assistance for homebuyers through two programs under the House Charlotte Assistance Program umbrella:

• For homebuyers with a maximum annual income of 80% of the area median income, it’s possible to qualify for up to $30,000 in down payment, closing cost assistance, and interest rate buy-down assistance.
• For homebuyers with an annual income of between 80% and 110% area median income, they could qualify for assistance of up to $10,000.

Who is Eligible?

Homebuyers with an annual income of up to 110% of the area median income, which is $109,650 for a family of four, could qualify for assistance through one of the two programs.

What Types of Properties are Eligible?

Homes located within Charlotte city limits are eligible as long as their purchase price doesn’t exceed $315,000 for new construction or $300,000 for existing homes. The home that is being purchased must pass inspections.

How Does it Work?

Homebuyers must apply for the program through an approved lender. The lender will apply for assistance on your behalf. Once the program receives a complete loan file, the program will determine your eligibility and assistance level within 20 business days. Homebuyers must complete a pre-purchase homebuyer education course and counseling through a HUD-approved financial education counseling agency. This assistance can be combined with other programs.

Is It A Grant Or Loan?

Both programs issue a 0% interest forgivable loan. For homebuyers whose income is no more than 80% of the area median income, the assistance is provided through a 30-year deferred loan that is forgiven in year 31. Assistance issued as part of the 80% to 110% area-median income program is done through a 15-year deferred loan that is forgiven in year 16.

What’s Good About This Program?

If you’re planning to stay in your home for the long term, your loan will be completely forgiven.

North Carolina Housing Coalition Homeowner Assistance Program

The North Carolina Housing Coalition Homeowner Assistance Program provides down payment and closing cost assistance for first-time homebuyers, those who haven’t owned a home in the last three years, and first-generation homebuyers who don’t currently own a home. Contact the program directly to find out how much they typically award homebuyers.

Who is Eligible?

To be eligible for assistance, homebuyers should have an annual income no more than 120% of the area median income, no more than $30,000 in liquid assets, and have pre-approval for a first mortgage loan.

What Types of Properties are Eligible?

To be eligible, the home must be located in one of the 16 counties “most impacted and distressed” by hurricanes Matthew and Florence. (Check the website for a list.) The home purchase must be intended for use as the homebuyer’s primary residence, and the seller and homebuyer can’t be related.

How Does it Work?

Homebuyers should contact the North Carolina Housing Coalition HAP program at HAP@nchousing.org to apply. Homebuyers will need to complete a homebuyer education course and counseling session prior to purchase.

Is It A Grant Or Loan?

This is a 0% interest loan that will be forgiven after the homebuyer stays in the home for three years.

What’s Good About This Program?

This is one of two programs targeting counties that have been the most severely impacted by recent hurricanes. If you’re a homebuyer looking to purchase in one of these areas, this might be a good program for you to check out.

Chapel Hill Employee Down Payment Assistance Program

The Chapel Hill Employee Down Payment Assistance Program provides up to $12,500 in down payment and closing cost assistance for employees of Chapel Hill.

Who is Eligible?

Chapel Hill employees are eligible if they have a maximum annual income of 115% of the area median income. For a family of four that’s $109,825 per year.

What Types of Properties are Eligible?

Homebuyers purchasing homes located within a five-mile radius of Chapel Hill could be eligible for up to $12,500 in assistance. Homebuyers purchasing homes within a five-mile radius of Chapel Hill Corporate Limits could be eligible for up to $7,500 in assistance. In both cases, the home will need to be the homebuyer’s primary residence.

How Does it Work?

Apply online here. Homebuyers must attend a homebuyer education course and counseling session prior to closing on the purchase.

Is It A Grant Or Loan?

This is a 0% interest loan forgiven at 20% each year the employee is employed by the Town of Chapel Hill. If the employee leaves their job within five years of purchase, they must pay back any unforgiven balance of the assistance.

What’s Good About This Program?

This program is targeted to employees of Chapel Hill. If you’re a Chapel Hill employee, check out this program first before applying for one of the statewide or other local assistance programs.

The Bottom Line

As a first-time homebuyer, saving enough money to make your purchase can feel like a steep hill to climb. But if you can secure assistance in paying for some of your down payment, closing costs, or even in buying down your interest rate, it could help you get to the top of your hill quicker. Then all you have to do is enjoy the view.