TAKING ACTION
Town of Wake Forest | HOUSING AFFORDABILITY PLAN
Strategy 1: Expand and Preserve Homeownership
Down-Payment Assistance (DPA) Program
Program Overview The Town can allocate funding for a supplemental Down-Payment Assistance (DPA) program that can be layered with Wake County’s DPA program, increasing access to homeownership for moderate-income buyers (Figure 45). Wake County has a strong DPA program, but it alone does not offer enough subsidy to close the gap to make a down payment on a home for many households. To support households that can afford monthly mortgage payments, but do not have sufficient savings for a down payment, the Town can allocate $7,000-$15,000 per household. How Does it Work? Down-Payment Assistance reduces the upfront costs of homeownership through grants or forgivable loans. These grants or loans go to income-qualified households to cover a portion of the down payment and closing costs for a home. DPA is typically paired with homeownership counseling to prepare first-time buyers for the full costs of housing, including utilities, insurance, and maintenance.
FIGURE 45: DOWN-PAYMENT ASSISTANCE EXAMPLE (60% AMI)
TOTAL PURCHASE PRICE
$10,000 DPA $15,000 from household
$250,000 Home Price
$225,000 Mortgage
IMPLEMENTATION
1. Set program budget and periodically reevaluate annual allocation within the Town’s budget. 2. Work with Wake County to align the rules and regulations. 3. Identify a community partner to conduct outreach to potential homebuyers to create a pipeline of residents who can participate in the program. 4. Connect residents to homebuyer counseling, through Wake County program or other non-profit partners.
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