Home is Possible for Heroes Adds 1% Grant

The Nevada Housing Division recently announced the enhanced Home is Possible for Heroes program to honor those who have served our country with the realization of home ownership. Beginning on May 1st, 2015 a new 1% Non-Repayable Grant will be available to Nevada’s Heroes to assist with their down payment and closing costs when purchasing as their primary residence.

NHD has partnered with private sector approved mortgage lenders such as Academy Mortgage to make this opportunity a reality. Nevada’s Veterans face a growing challenge as the home buying market becomes more competitive and Nevada’s home prices continue to rise at the fasted rate in the nation.

Demographics support a need for enhanced programs which benefit Nevada Veterans. Approximately 30% of Veteran households in Nevada are renters (62,000). 45% of those households (28,000) have an income between $40,000 and $110,000. (Estimates derived from the American Community Survey downloaded from the American Factfinder at the Census bureau on 12/20/13.)

The Nevada Housing Division and the Nevada Rural Housing Authority are addressing the needs of Nevada’s Veterans through programs such as Home is Possible for Heroes and the Home is Possible and Home at Last 4% non-repayable grant programs.

The Home is Possible for Heroes program provides:

  • Below market interest (currently 3.25%)
  • 1% Non-Repayable Grant
  • Optional Mortgage Tax Credit Program (Annual Dollar for Dollar Tax Credit equal to the lesser of $2,000 or 40% of the annual interest paid on your mortgage.)

I am currently working with a qualified veteran who is purchasing a home in Fernley. The purchase price is $168,000. Similar homes rent for $1,250-$1,300 a month. The cost of renting a similar home would be more than $78,000 over the next 5 years. Over the same 5 year period, my client will have over $16,000 in equity based solely on principle reduction. Add to that your mortgage interest tax credit and the pride associated with owning your own home, buying now will be the right choice for Nevada’s heroes.

The below Total Cost Analysis compares:

 

Heroes TCA

 

When you compare the Home is Possible for Heroes program with a standard VA loan, the Hme is Possible for Heroes advantages are apparent. In this illustration, the monthly payment is $47.89 less, or a savings of $574.68 a year. On top of the monthly savings, the cash you need to close is about $1,750 less with the Home is Possible for Heroes.

In the 3rd. column, we look at adding Nevada Housing Division Mortgage Tax Credits. Although the monthly payment remains the same, the cash necessary to close increases due to the Mortgage Tax Credit program. The cost of the Tax Credit program is 1% of you loan amount, plus a $175 processing fee. *As of January 1, 2015, qualified veterans will receive a $400 discount off MTC fees.

In this  example, you will receive the maximum $2,000 a year tax credit for the first 9 years you own the home.  The mortgage tax credits will have a total value in excess of $38,000 should you live in the home for 30 years and make the minimum monthly payment. When combined with the current $47.89 a month savings, resulting from the lower Home is Possible for Heroes interest rate, you will be saving more than $2,500 a year over the first 9 years you own the home. * Your actual monthly savings and tax credit will vary based on your loan amount and the interest rate at the time you lock your loan.

The 4th column illustrates the benefits of the Home is Possible VA 4% non-repayable grant program. The advantage of the 4% grant program is you can own the home with little to no money out of pocket. Although the $1,017.72 monthly PITI payment is about $37 a month higher than a regular VA loan, after you factor in the mortgage tax credit, the payment is actually $129 a month less for the first 13 years you own the home.  Due to the higher interest rate, you will receive the maximum $2,000 a year tax credit for each of the first 13 years you own the home. The total value of the tax credits in this example is more than $45,000 over 30-years.

If you have the ability to pay your closing costs, the new Home is Possible for Heroes 1% Grant program with a 3.25% interest rate combined with the mortgage tax credits is your best choice. If money for your closing costs is an issue, the Nevada Housing Division Home is Possible 4% Grant program with a 4.125% interest rate combined with mortgage tax credits will be the right choice.

If you are currently in the Reserves or the National Guard, but are not eligible for a VA loan, similar Home is Possible for Heroes advantages are available. Reservists and Guardsman qualify for the same non-repayable grants and same low interest rate.  The difference is; your loan will have to be through either FHA or USDA. I will be happy to create a total cost analysis specific to your scenario.

Highlights of the Home is Possible for Heroes program include:

  • Below market 30-year fixed mortgage interest rate (currently 3.25%  – you can check the rate each day at eHousingPlus)
  • No first time homebuyer requirement

Home is Possible for Heroes is available to:

  • Veterans who have been honorably discharged
  • Those serving on Active Duty
  • National Guard service personnel
  • Surviving spouse

*The home being purchased must be primary residence

Home is Possible for Heroes can be combined with the Mortgage Tax Credit program to provide even more savings for the homebuyer

  • Income limit of $95,500
  • Based on income from the mortgage application
  • Maximum purchase price of $400,000
  • The program is available statewide
  • eHousingPlus is the program administrator
  • Minimum credit score of 640 for government insured loans, 660 for manufactured housing
  • Must meet normal government underwriting requirements
  • This product is not eligible for use with conventional loans

Mortgage Tax Credit Veteran Discount

As of January 1, 2015, qualified veterans will receive a $400 discount off MTC fees.  Veterans who are honorably discharged, are first time homebuyers serving on active duty, or National Guard service personnel are eligible.

Nevada loves it’s Heroes! If you have been dreaming of owning your own home, this is your chance. For additional information about the “Home is Possible” grant and MCC programs, call Doug Kaller, Academy Mortgage @ 775-828-7006 or email doug.kaller@academymortgage.com. To find out what you qualify for, please click on the orange “Pre-Qualify Now” tab at the bottom of this page. Don’t let the lack of a down payment prevent you from realizing the dream of owning your own home.

Doug Kaller

Loan Officer

Academy Mortgage

5250 South Virginia Suite 240

Reno, NV 89502

( D: (775) 828-7006 | C: (775) 250-4421

( F: (888) 449-7473 | O: (775) 825-4545

*doug.kaller@AcademyMortgage.com

www.AcademyMortgage.com/dougkaller
LO NMLS #312085 | State Lic #NV Lic#10361 | Corp Lic #2731 | Corp NMLS #3113

 

 

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