Buying a home is a major undertaking.  First time homebuyers have so many things to worry about that it’s difficult to prioritize during the home-buying process.  Mortgage assistance grants are designed to take much of the worry out of purchasing a home for the first time.  Mortgage assistance grants are designed to pay a specific amount of money to the first time homebuyer, so they have the opportunity to use the money as part of their down payment.  Mortgage assistance grants do not have to be paid back, and they are available from any number of sources.  While agencies such as HUD do not offer grants, often they are able to refer first time homebuyers to websites and organizations that do offer mortgage assistance grants. 

How Mortgage Assistance Grants Work

Mortgage assistance grants work differently from loans and other financial options.  The US Government never gives mortgage assistance grants to a specific person.  Instead, they are distributed to individual states to be divvied up as needed.  Of course, no grant will completely cover the down payment on a home; they’re just meant to complement the existing down payment a customer may already have.  Grants are also made available to non-profit organizations around the country, in addition to local governments.  

How To Qualify

To qualify for a mortgage assistance grant, homebuyers must meet a few conditions.  First, they must be purchasing their first home.  Mortgage assistance is only available to those who have never made a home purchase before.  In addition, homebuyers must be able to qualify for a mortgage on their own, with no grant assistance factored in.  Regardless of the price of the home, a mortgage assistance grant cannot cover the entire cost of the home. 

Buyers must attend housing counseling classes.  There are housing counseling classes that are fully endorsed by HUD.  If buyers are not willing to attend the requisite classes, they do not qualify for mortgage assistance grants authorized by the Federal Government. 

Each state has its own regulations and guidelines for determining exactly who can qualify for mortgage assistance.  While federal guidelines must be followed in their entirety, the state guidelines vary widely.  Some states require that buyers meet minimum income requirements, and some require customers to have a long, established credit history with few blemishes. 

The requirement that a prospective buyer be a first time homebuyer is a bit more lenient in some states.  The requirement actually states that the person cannot have owned a home at any time within the past three years. 
There are other types of grants, as well.  In addition to the government grants, there are private grants available, as well.  The private grants typically come from various non-profit organizations in the state in which the homebuyer resides. 

Where To Find More Information

There is a great deal of information online about all the mortgage assistance grants that are available to homebuyers.  While any information obtained from the Internet should be taken with a grain of salt, there are some sources that can be trusted implicitly.  The websites run by the government are, of course, the most reliable, while those run by individual nonprofits only slightly less so.

The US Department of Housing and Urban Development website lists many of the requirements that need to be met in order to qualify for a government-backed grant.  While the government itself doesn’t provide grant money directly to homebuyers, there are funds made available to states, and the website links to information on a state-by-state basis.  By clicking on the individual state that is linked on the HUD website, information can be found that precisely outlines the requirements to get the grant money. 

Of course, there is information available from third-party websites, as well.  Homebuyinginstitute.com provides information for homebuyers that includes grant applications and lists of local entities that provide grant money to first time homebuyers.  As with all Internet websites, research should be done to determine exactly how reliable the website is.  Online message boards often provide customer satisfaction surveys and comment logs that allow customers to exchange ideas and stories about online companies with whom they’ve dealt.  Testimonials from other customers are often the best way to determine the reliability and validity of a website’s information. 

How To Write The Application

Requesting a grant always involves writing a grant application.  There are many different incarnations of grant applications, and the information required on each can vary widely from one to the next.  All grant applications will include your personal information, of course, and the purpose for which you intend to use the money.  Grant applications should be written like a business plan, outlining briefly the intentions of the person writing the application.  The most important thing to remember when writing the application, though, is to write the application so it will stand out from the thousands of others the granting party will be receiving.  Grammar and punctuation are important, but content is far more so. 

Give an extremely detailed account of why the money is needed and for what purposes it will be used.  Discuss the current financial situation, and provide a detailed breakdown of the finances that have already been obtained.  If the person writing the grant application has already applied and been approved for a loan, include the name of the bank and the amount of the loan that has been approved.  Because federal guidelines require that the person to receive the money must be able to obtain full funding without taking the grant into account, it’s important that the party responsible for granting the funds be made fully aware of the petitioner’s ability to pay. 

A brief illustration of the creditworthiness and reliability of the person writing the grant application is certainly a good idea, and providing employment and character references is sure to get that particular application noticed more quickly than others.  Take the time to properly outline your grant application, and you’ll be in much better shape to request the funds.