On June 10th, 2019, the Philly First Home Program will launch, replacing the existing Department of Housing and Community Development (DCHD) Settlement Assistance Grant of $1,000. The Philly First Home Program offers qualified home buyers with a grant of 6% of the purchase price of the home or $10,000, whichever is less.
To qualify for the grant/loan, you must be a First Time home buyer, having not owned a home in the previous three years, must occupy the premises as the primary residence, have family income of 120% or less of Area Median Income (AMI), and have completed pre-purchase counseling with a DHCD funded housing counseling agency prior to signing an Agreement of Sale.
Homebuyers can use the grant for the down payment and/or closing costs. To keep the grant, the property must be owner occupied for the full term of 15 years. After 15 years, the loan will be forgiven and the lien satisfied. However, in the event of a default, the loan will accrue an interest rate of 6% per annum until the default is cured. There are two cases that would constitute a default; non-owner occupancy or failure to maintain Homeowner’s Insurance. The loan will have a second position lien on the property with a Mortgage and Note, however, there will be no interest accruing or monthly payments required provided the terms are met. Heirs will be able to assume the loan if the heir takes title to the property and makes it their primary residence.
