ENGLEWOOD, Colo. (CBS4) – Colorado home prices have sky rocketed, at the same time that wages have stalled, making it very difficult for many people to put together the money they need to buy a home. The City of Denver sponsors a program that helps fill that gap for qualifying home buyers. It's called the Metro Down Payment Assistance program. Through a partnership with the Metro Mayors' Caucus, they've expanded the program beyond Denver's borders.
"Our Metro Down Payment Assistance program is a way to help homeowners to get some down payment assistance by increasing their interest rate just slightly," explained Britta Fisher, Chief Housing Officer for the City of Denver.
The home buyer works through one of 80 approved lenders to set up a second mortgage for as much as a 6-percent down payment. There are no scheduled payments on that second mortgage, and the loan is completely forgiven after 3-years. In return for this essentially free money, the home buyer agrees to pay a slightly higher interest rate on their first mortgage, with that extra interest going to pay for the second loan.
"It's a great way to reach a lot more folks at low and moderate incomes," Fisher told CBS4.
To qualify for Metro DPA, you have to have an income less than $139,200, and a FICO score of 640. You also have to be approved for financing of the house. There are no first time home buyer requirements on this program. And there are no purchase price limits on the house.
"Denver is committed to achieving housing stability across all income levels," Fisher said.
LINK: Metro DPA
Metro DPA is among various tools that the City is using to address affordable housing. Millennials have more debt than any other generation. While many of them earn a wage that allows them to pay a house payment, it's hard for them to put together the chunk of money needed for a down payment.
Rachel Palya is among the home buyers who got the money. She got $14,000 toward her home in Englewood. She bought a mid-century, 3-bedroom, 2-bath.
"I liked the location. I really liked the house, and you know 3-bedrooms is a good amount that you can grow into," Palya told CBS4's Britt Moreno.
Palya admits that she still doesn't know how to use a lawnmower, but she's embracing homeownership well. She installed a dog door for her precious pooch, Itchy.
"I'm at the age where I just wanted to start building equity in something," Palya explained.
It's hard not to want to get into the housing market, when there is free money to help pave the way.
"It's really nice. I mean why not take the opportunity if it's there," Palya said.
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