know your options before you buy a new home

Everything You Need To Know About Using VHDA Home Loans To Buy Your First Home in Virginia

The Virginia Housing Development Authority (VHDA) is a state-level authority that offers a variety of home loan programs to Virginians. VHDA's programs are designed to help first-time homebuyers, low- and moderate-income families, and people with special needs.  VHDA also offers a variety of homebuyer programs, such as down payment and closing cost assistance, to help make homeownership more affordable.

VHDA offers some of the best first time homebuyer grants and programs in the country.

While affordable homes, good schools and transportation lead to better individual lives and stronger communities, individuals can only realize these goals if they are accessible to them.  Virginia Housing was created in 1972 by the General Assembly to help Virginians achieve quality, affordable housing.  We carry out this mission by working with local governments, community service organizations and other partners.

The Virginia Housing Corporation (VHDA) receives no state taxpayer dollars and funds its programs through private capital markets.

VHDA Housing Offerings

1. Mortgages for first-time homebuyers.
2. Financing for apartment communities and neighborhood revitalization efforts.
3. Free homebuyer classes.
4. Support for housing counseling.
5. Home accessibility grants for people with disabilities and the elderly.
6. Administration of the Federal Housing Choice Voucher and Housing Credit programs in Virginia.

For the most current information on VHDA home loan options, please visit VirginiaHousing.com/HomebuyerPrograms.

VHDA Grant Programs

Qualified first-time homebuyers can get funds to help make the dream of homeownership a reality by utilizing VHDA's Down Payment Assistance Grant program or their VHDA Closing Cost Assistance Grant program.

Some of the benefits of using the grant program from VHDA include:

1. The maximum grant is 2 – 2.5% of the purchase price, depending on which type of Virginia Housing mortgage loan you receive.
2. Because this is a grant, you never have to pay it back.
3. Borrowers who receive this grant are also eligible for a VHDA Mortgage Credit Certificate (MCC)

Some of the requirements to use the VHDA Grant Program are:

1. You must be a first-time homebuyer.
2. Grant funds must be used with an eligible Virginia Housing loan
3. Income of all household members cannot exceed VHDA loan limits; see VirginiaHousing.com/LoanLimits
4. For the complete list of requirements, please visit VirginiaHousing.com/LoanInfo

To see if you qualify for a Closing Cost Assistance Grant or to learn more about VHDA's Down Payment Assistance Grant, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender.  Call or Text 757-287-4098 today.

VHDA Closing Cost Assistance Grant

The Closing Cost Assistance Grant will reduce the costs for those applying for a Rural Housing Service (RHS) or Veterans Affairs (VA) loan. This grant makes these 100% financing programs even more affordable.

Some of the benefits of using the Closing Cost Assistance Grant from VHDA include:

1. The maximum grant is 2% of the purchase price.
2. Because this is a grant, you never have to pay it back.
3. Grant funds can be applied to your closing costs, RHS guarantee or VA funding fee.
4. Borrowers who receive this grant may also qualify for a VHDA Mortgage Credit Certificate (MCC).
5. It may strengthen your negotiation of RHS and VA contracts.

Some of the requirements to use the VHDA Closing Cost Assistance Grant Program are:

1. You must be a first-time homebuyer.
2. This grant must be used with an RHS or VA loan from VHDA.
3. Income of all household members cannot exceed VHDA loan limits; see VirginiaHousing.com/LoanLimits.
4. The eligible Virginia Housing mortgage must be locked prior to reserving grant funds.
5. For the complete list of requirements, please visit VirginiaHousing.com/LoanInfo.

To see if you qualify for any of VHDA's first time homebuyer grants and programs, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender. Call or Text 757-287-4098 today.

VHDA Down Payment Assistance Program Grant

Virginia Housing’s Down Payment Assistance Grant provides qualified first-time homebuyers with funds to help make the dream of homeownership a reality.

Some of the benefits of using the Down Payment Assistance Grant from VHDA include:

1. The maximum grant is 2 – 2.5% of the purchase price, depending on which type of Virginia Housing mortgage loan you receive.
2. Because this is a grant, you never have to pay it back.
3. Borrowers who receive this grant are also eligible for a VHDA Mortgage Credit Certificate (MCC).

Some of the requirements to use the VHDA Down Payment Assistance Grant Program are:

1. You must be a first-time homebuyer.
2. Grant funds must be used with an eligible VHDA mortgage loan.
3. Income of all household members cannot exceed VHDA loan limits; see 3VirginiaHousing.com/LoanLimits.
4. The eligible Virginia Housing mortgage must be locked prior to reserving grant funds.
5. For the complete list of requirements, please visit VirginiaHousing.com/LoanInfo.

To see if you qualify for a Down Payment Assistance Grant or to learn more about VHDA's Down Payment Assistance Grant, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender. Call or Text 757-287-4098 today.

VHDA Government Loan Programs

FHA Mortgage - Federal Housing Authority

1. FHA-insured
2. Eligible for VHDA's Down Payment Assistance Grant or Plus Second Mortgage
3. 3.5% down payment (or as low as 1% down with our Down Payment Assistance Grant, or 0% down with our Plus Second Mortgage)
4. Liberal credit qualifying; credit scores may be as low as 620

USDA Mortgage - Rural Housing Service

1. USDA-guaranteed
2. Eligible for VHDA's Closing Cost Assistance Grant
3. 100% financing for eligible rural properties
4. Affordable monthly payments
5. Low mortgage insurance
6. Liberal credit qualifying; credit scores may be as low as 620

VA Mortgage - Veterans Administration

1. VA-guaranteed
2. Eligible for VHDA's Closing Cost Assistance Grant
3. 100% financing for eligible veterans
4. Liberal credit qualifying; credit scores may be as low as 620

To see if you qualify for any of the VHDA Government Loan Programs or to learn more about the VHDA Government Loan Programs, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender. Call or Text 757-287-4098 today.

VHDA Conventional Loan Programs

These loans provide affordable financing for first-time and repeat homebuyers.

Conventional Mortgage With Mortgage Insurance

Some of the benefits of a VHDA Conventional Mortgage include:

1. Less cash required at closing than with an FHA loan.
2. Available to first-time and repeat homebuyers.
3. May be used for purchase or limited cash-out refinance.
4. This is a 30-year, fixed-rate loan.
5. This loan has the lowest conventional mortgage insurance payments available.
6. Flexible down payment sources are allowed, including gifts, our Down Payment Assistance Grant, Virginia Housing Plus Second Mortgage and other eligible second mortgages.
7. Borrowers who qualify for this loan may also be eligible for a VHDA Mortgage Credit Certificate (MCC).

Some of the requirements for a VHDA Conventional Home Loan are:

1. 3% down payment (or as low as 1% down with our Down Payment Assistance Grant, or 0% down with our Plus Second Mortgage).
2. 640 minimum credit score.
3. Maximum 45% debt-to-income ratio.
4. 3% maximum seller concessions (or 6% if making a down payment of 10% or greater).
5. Maximum 97% loan-to-value (105% combined loan-to-value).
6. Loans up to conforming limits.
7. Maximum income limits apply; see VirginiaHousing.com/LoanLimits.

To see if you qualify for any of the VHDA Conventional Loan Programs or to learn more about the VHDA Conventional Loan Programs, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender. Call or Text 757-287-4098 today.

Conventional Mortgage With No Mortgage Insurance

Affordable monthly payments, with no mortgage insurance required.

A few of the benefits of using a VHDA Conventional Mortgage to buy a home are:

1. Less cash required at closing than with an FHA loan.
2. Available to first-time and repeat homebuyers.
3. May be used for purchase or limited cash-out refinance.
4. This is a 30-year, fixed-rate loan.
5. This loan has the lowest conventional mortgage insurance payments available.
6. Flexible down payment sources are allowed, including gifts, our Down Payment Assistance Grant, VHDA Plus Second Mortgage and other eligible second mortgages.
7. Borrowers who qualify for this loan may also be eligible for a VHDA Mortgage Credit Certificate (MCC).

Here are some of the requirements to use a VHDA Conventional Mortgage:

1. 3% down payment (or as low as 1% down with our Down Payment Assistance Grant, or 0% down with our Plus Second Mortgage)
2. 660 minimum credit score.
3. Maximum 45% debt-to-income ratio.
4. 43% maximum seller concessions (or 6% if making a down payment of 10% or greater).
5. Maximum 97% loan-to-value (105% combined loan-to-value).
6. Loans up to conforming limits.
7. Maximum income limits apply; see VirginiaHousing.com/LoanLimits.

To see if you qualify for any of the VHDA Conventional Loan Programs or to learn more about the VHDA Conventional Loan Programs, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender. Call or Text 757-287-4098 today.

VHDA Plus Second Mortgage Loan A Down Payment Assistance Loan

The Virginia Housing Plus Second Mortgage eliminates the down payment requirement for first-time homebuyers by utilizing an eligible VHDA first mortgage with a VHDA Plus second mortgage to cover the initial down payment.

Some of the benefits of the VHDA Plus Second Mortgage Program include:

1. Maximum second mortgage is 3 – 5% of the purchase price, depending on your credit score and type of VHDA first mortgage you receive.
2. This is a 30-year, fixed-rate loan with no prepayment penalty.
3. This loan covers your entire down payment.
4. Qualified buyers with credit scores of 680 or higher can also finance part of their closing costs into the second mortgage.
5. Borrowers who qualify for this loan are also eligible for a VHDA Mortgage Credit Certificate (MCC).

A few of the requirements for a VHDA Plus Second Mortgage are:

1. You must be a first-time homebuyer.
2. Income of all borrowers cannot exceed Virginia Housing loan limits; see VirginiaHousing.com/LoanLimits.
3. At closing, borrowers must have 1% of purchase price available to them.
4. This loan is for purchase transactions only.
5. For the complete list of requirements, please visit VirginiaHousing.com/LoanInfo.

To see if you qualify for the VHDA Plus Second Mortgage Loan Program or to learn more about the VHDA Plus Second Mortgage Loan Program, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender. Call or Text 757-287-4098 today.

VHDA Mortgage Credit Certificate Benefits

A Mortgage Credit Certificate (MCC) from VHDA could save you thousands of dollars by reducing the amount of federal income tax you owe each year you own your home.
Some of the benefits of a VHDA MCC - Mortgage Credit Certificate are:

1. This is a dollar-for-dollar credit toward your federal income tax liability.
2. The annual credit is equal to 10% of the annual mortgage interest you pay.
3. The MCC is effective for the life of the mortgage, as long as requirements are met and the loan is not refinanced.
4. There may be no charge for an MCC if issued with a Virginia Housing first mortgage loan; ask your lender if fees will be charged.
5. Borrowers may also be eligible for a Virginia Housing Plus Second Mortgage, a Down Payment Assistance Grant or a Closing Cost Assistance Grant.

Some of the eligibility requirements for the VHDA Mortgage Credit Certificate are:

1. You must be a first-time homebuyer (not owned a home as a primary residence within the past three years), a requirement that may be waived if purchasing a home in a Federal Targeted Area; see VirginiaHousing.com/FederalTargetedAreas.
2. The home must be used as your principal residence.
3. Maximum household income limits apply; see VirginiaHousing.com/LoanLimits.
4. You must purchase a home that meets the sales price/loan limit requirement; see VirginiaHousing.com/LoanLimits.

Please consult with a tax advisor, but the scenario below shows an example of potential savings. The example assumes a $150,000 loan with an interest rate of 4.5%.

$200,000 x 4.5% = $9000 interest for first full year

$9000 x 10% tax credit rate = $750 tax savings for the year (Max Savings)

How Do I Apply For A VHDA MCC?

1. Apply for an MCC with an approved MCC lender.
2. Sign and provide the MCC Homebuyer Application and Fact Sheet to your lender; this form can be found at VirginiaHousing.com/MCC.
3. Receive an MCC commitment from Virginia Housing prior to closing.
4. During loan application, be sure to confirm that you’ve requested an MCC; you will initial in the MCC section of the Single Family Loan and MCC Disclosure form.

If you sell your home within nine years of closing and have also experienced a significant increase in your income during that time, you may be subject to an IRS rule known as the federal recapture tax. The additional amount you would owe at that time would depend on the year you sold your home, how much gain you received from the sale and what your income was that year.

Ask your lender for information and discuss the potential impact of the federal recapture tax with your tax advisor. Learn more at VirginiaHousing.com/RecaptureTax

What Is A VHDA Combo Loan?

Do you need something more than an affordable home loan? Well you can get a VHDA home loan with a home buyer tax credit (MCC), a down payment grant, & a free homebuyer class to make it a VHDA Combo Loan. The Virginia Housing Loan Combo, a package of money-saving benefits put together especially for first-time homebuyers. No one else in Virginia has anything like it. So, don’t settle for just a loan, make it a VHDA Loan Combo. Learn more at VirginiaHousing.com/LoanCombo.

To see if you qualify for the VHDA ComboLoan Program or to learn more about any of the VHDA home loan programs, please contact Jimmy Sgambelluri with Homespire Mortgage Company, a VHDA-approved lender. Call or Text 757-287-4098 today.

FAQ's

What Are The Eligibility Requirements For VHDA First Time Homebuyer Loan Programs?

The main requirements of the VHDA home loan program are you must be a U.S. citizen or permanent resident, have a credit score of 620 or greater, complete homeownership education & meet the income limits of your locality in Virginia.

What states Are VHDA Home Loans available?

VHDA Home Loans are only available in the State of Virginia. Other states have their own housing assistance programs.

Is VHDA the best first time homebuyer mortgage program in Virginia?

Many people would agree that it will be hard to find a better loan program when purchasing your first home. Between the down payments assistance and the reduced interest rate, the VHDA is making a difference in home ownership for Virginians.

What credit score is needed for VHDA home loans?

The minimum credit score required for most VHDA Home Loan programs is 620. The Conventional No Mortgage Insurance option requires a 640 minimum.

How long does it take to get approved for a VHDA loan?

The approval process for a VHDA home loan can vary from lender to lender. In most instances, a VHDA home loan can be closed in 30 days.

What types of properties can you purchase with VHDA Home Loan Programs?

VHDA loans can only be used for owner-occupied properties.

What are the loan limits for VHDA Home Loans?

Loan limits change from year to year and are based on cost of living adjustments in localities throughout the state. To get he most current loan limits visit: VirginiaHousing.com/LoanLimits

Program Limits & Income Limits

To see the most current information & any recent changes not reflected on this website, please visit:
VirginiaHousing.com/LoanLimits
VirginiaHousing.com/LoanInfo
VirginiaHousing.com/MCC

Get Mortgage Help Today

There are a lot of things to think about when you're buying your first home.  But with VHDA Home Loans, you can get the financing you need to make your dream a reality.  Contact Jimmy Sgambelluri with Homespire Mortgage Company today to get started.