Greyson Capital is Proud to Be an Approved Lender for the City of New Orleans Direct Homebuyer Assistance Program
Are you looking to buy a home?
Here you can use our online tools to learn more about home loans and find the best loan options to suit your needs and goals. You can explore our site without any obligation or disclosure of personal information, or if you want, you can even begin the application process online!
At any point, feel free to e-mail or call us regarding any questions you may have. You can find our contact information at the bottom of each page. We are here to personally help you through the entire home financing process.
City of New Orleans Direct Homebuyer Assistance Program
The Direct Homebuyer Soft Second Mortgage Assistance Program provides down payment and closing costs subsidies to eligible first- time homebuyers. Subsidies made available to Homebuyers Bridge the gap between the purchase price of the home and the maximum first mortgage loan amount. Subsidies also include closing costs.
The City of New Orleans Office of Community Development has $3,000,000 of Community Development Block Grant funds (CDBG) was made available for the Direct Homebuyer Soft Second Mortgage Assistance Program March 11, 2019 and will add additional funding as it becomes available. This program provides down payment and closing cost subsidies to eligible First-time Homebuyers whose income does not exceed 80% of the Area Median Income (AMI).
The Direct Homebuyer Soft Second Mortgage Assistance Program assist Homebuyers to bridge the gap between the purchase price of the home and the maximum first mortgage. Eligible Homebuyers using CDBG funds may receive up to $55,000 in soft second funds and up to $5,000 in closing cost assistance (CDBG guidelines only allow us to pay 50% of the total closing cost).
Eligible Homebuyers using CDBG-DR (Disaster Relief) (ends June 2023) funds may receive up to $65,000 in soft second funds and $5,000 in closing cost assistance. (Homes located in an area designated by the Federal Insurance Administrator as a special flood hazard area are not eligible for this program).
Soft Second Mortgage Terms
- 10-year forgivable loan
- 0% interest rate
- No payments
- Repayment of full amount becomes due if the buyer sells/moves before the end of the 5th
- After the 5th year of occupancy:
- 25% of the mortgage is forgiven
- 15% per year is forgiven each subsequent year until the grant is fully amortized in year 10.
- No pre-payment penalty
- No assumptions
- Maximum amount of the Soft Second Mortgage cannot exceed 50% of the purchase price of the home.
Property Eligibility Requirements
- Single family residential properties located in the City of New Orleans.
- List of neighborhoods and zip codes listed below.
- The purchase price of the home may not exceed $324,000.
- Newly constructed homes, renovated homes, townhouse or condo.
- Homes must be in compliance with the:
- City of New Orleans Housing Code
- International Residential Code
- HUD’s Housing Quality Standards
Homebuyer Eligibility Requirements and Obligations
- Employees of the City of New Orleans ARE eligible to participate in this program.
- Buyer must NOT have held an ownership interest in a residential property within the past 3 years.
- Homebuyer is required to occupy the home as his/her primary residence until the 10-year forgivable period will be obligate to repay all or a prorated portion of the soft second loan.
- All homebuyers will be required to complete a Homebuyer Education course by an HUD approved training agency (list provided by us).
- The buyer must select an approved title company (list provided by us).
- Homebuyers must contribute a minimum of 1% of the sale price or $1,500 (whichever is less) and must have liquid assets in reserve equal to 1 month of proposed household expenses after the payment of closing costs. Homebuyers must maintain Homeowner’s Insurance and Flood Insurance for the full-replacement value or sale price of property for the duration of the loan term.
