Many families in the Wabash Valley struggle to save enough for a down payment on a home. The tight housing market worsens the struggle, driving up prices on single-family homes and putting them even more out of reach for low- to moderate-income families. For many households, a down payment assistance program can help to make homebuying more affordable, and this program aims to make homebuying easier for qualifying families.
The United Way of the Wabash Valley Home Down Payment Assistance Program has been formulated to ease the path to homeownership. It is a joint venture between United Way and partner financial institutions in the Wabash Valley. This program will provide up to 5% in assistance (3% down payment and 2% for closing costs) for the purchase of a home up to a price of $80,000. A purchase price over $80,000 will be considered for qualification, however, the assistance payment from United Way will not exceed $4,000.
There are eight eligibility requirements when applying for the program. They include the following:
- The entire household size and income must be under the county’s 80% Area Median Income and the applicant must provide proof of income. These limits are established by the federal government. Click here for the income eligibility table.
- The applicant must complete approved financial literacy classes prior to closing on the home or provide proof of completing such courses in the last year.
- Applicants must invest $1,000 of their own funds.
- Applicant must be a U.S. Citizen or a legal resident with a social security number.
- Applicant must be able to obtain homeowner’s insurance in an amount equal to/
greater than the value of the property for the entire recapture period.
- Applicant must remain in the home for 5 years or otherwise repay a prorated
portion of the funding in accordance with the recapture agreement with UWWV.
- The purchased home must be the applicant’s primary residence.
- Applicant’s new residence must be in one of these counties: Clay, Parke, Sullivan, Vermillion,
and Vigo Counties in Indiana and Clark County in Illinois.
You can find the eligibility form below and a link to the digital pamphlet containing information about the program. If you have any other questions contact us at (812) 235-6287 or come to our office at 100 S. 7th St, Terre Haute, IN 47807.
United Way of the Wabash Valley Home Down Payment Assistance (HDPA) Program Steps
1. A good starting point is to identify a mortgage loan that suits your needs. UWWV is working with a number of local banks that are familiar with United Way’s Home Down Payment Assistance Program. The list can be found on United Way’s website: uwwv.org/hdpap/. By working with a mortgage lender, you’ll learn how much you can afford to spend on a home.
2. You or your mortgage lender should contact United Way of the Wabash Valley (UWWV) to make sure funds are still available.
3. After obtaining an Eligibility Requirements form from your mortgage lender, you should work with your lender to make sure you meet the list of requirements.
4. When you are close to signing a purchase agreement, you and your lender must initial and sign the Eligibility Requirements form and return it to UWWV. After your signed Eligibility Requirements form has been approved by UWWV, you’ll have two months to close on your house. If this deadline passes, then funding will be withdrawn, but you will still be eligible to reapply at a later date, provided funds are still available.
5. UWWV will send you a signed UWWV Commitment Letter, confirming that you are approved for the Home Down Payment Assistance Program and outlining the terms of the program.
6. After the closing date has been scheduled, your mortgage lender should send the Bank Approval Notification (on bank letterhead) to UWWV. The financial institution should also notify UWWV of the type of payment that will be needed from UWWV at the time of closing.
7. UWWV will prepare a Recapture Agreement that will be included and signed at the time of closing. The agreement will be recorded with the county. The Recapture Agreement allows United Way the option of taking back a portion of your down payment assistance if the terms of your agreement are not kept. Such decisions are made on a case-by-case basis.
8. United Way’s down payment assistance will be applied to your down payment and closing costs at the time of closing.
The following four participating banks are offering specialized mortgage packages for applicants to consider:
- The Hometown Savings Bank
- First Financial Bank
- Fifth Third Bank
- First Farmers Bank & Trust
To find contact information for the specialized mortgage lenders at these banks, click the eligibility form below.