MIPAP Funding is now available to qualified homebuyers. For first-time buyers wanting to purchase a home in Arlington, this program provides a deferred-payment, no-interest loan of up to 25% of the home purchase price. The loan may be used to cover a portion of the down payment and all closing costs. Program funding availability is on a first come, first served basis to qualified homebuyers. The MIPAP loan acts as a 2nd Mortgage. The 1st Mortgage must be a conventional loan from a lender approved by VHDA (Virginia Housing Development Authority). The maximum purchase price is $500,000 and the maximum loan amount is $112,500.
MIPAP uses a shared appreciation model, which means there are no interest or monthly loan payments over the course of the loan. Instead, when a homebuyer chooses to sell or refinance the property, an appraisal of the property will be done to determine if the property has increased in value. If the property value has increased, the homebuyer would owe the County the original loan amount plus a proportionate share of the net appreciation (up to 25%).
MIPAP requires that applicants follow a pre-approval process- which may take up to 45 days. If pre-approved, the applicant will receive a maximum loan amount to be added to the 1st trust amount for purchase of a home. The Pre-Approval certificate is valid for 6 months.
Borrower Eligibility Criteria
- Homebuyers must meet the following eligibility criteria:
- Be a first-time homebuyer or a homebuyer who has not owned a home in the previous 3 years;
- Applicants must not be under contract to purchase a home at the time of MIPAP Pre-Approval Application
- Have a household income at or below 80% of the Area Median Income for their family size;
- Have a minimum credit score of 660;
- Provide a down payment equal to 1% (from prospective purchasers’ savings) or more of the purchase price set forth in the contract;
- Secure first trust lender financing;
- Ratios of housing expenses to income and total debt to income must not exceed 45%.
- Potential MIPAP borrowers must complete the following steps:
- Attend a 6-hour VHDA Homebuyer Education Course and obtain a certificate of completion; and
- Attend Financial Counseling Course and complete a Spending Plan with a VHDA Homeownership Counselor
- Obtain a good faith pre-qualification letter from a VHDA-approved first trust lender willing to provide a conventional first trust mortgage;
- Complete and submit the entire MIPAP Pre-Approval Application
For further information regarding this process, contact:
Odalis Barrios: email@example.com