TALLAHASSEE, Fla. – Even though cash remains king to many home sellers, a range of programs exist to help first-time homebuyers with down payments and/or closing costs. In Florida, the state administers three programs through the Florida Housing Finance Corporation (FHFC).

According to FHFC, the programs operate like second loans when using one of FHFC’s first-mortgage loan programs. They include:

The Florida Assist (FL Assist) offers up to $10,000 on FHA, VA, USDA and conventional loans as a 0%, non-amortizing, deferred second mortgage. The aid isn’t forgivable – it must be paid back. However, the money doesn’t have to be repaid until the buyer sells or transfers the home, satisfies the first mortgage, refinances or moves out.

The Florida Homeownership Loan Program (FL HLP) Second Mortgage also offers $10,000. It works as a 3% fully-amortizing, second mortgage over a 15-year term that includes a monthly payment. The remaining unpaid principal balance (UPB) is deferred, though, unless the first-time buyer sells or transfers the deed, satisfies the first mortgage, refinances or moves. (Note: It carries a monthly payment that may need to be considered in a borrower’s debt-to-income (DTI) ratio for credit underwriting).

The HFA Preferred and HFA Advantage PLUS Second Mortgage are down payment and closing cost programs that offer buyers 3%, 4% or 5% of the total loan amount in a forgivable second mortgage. The “forgive” rate is 20% per year over its 5-year term when used with Florida Housing’s conventional HFA Preferred for TBA or HFA Advantage for TBA first mortgage products. The “PLUS” Second Mortgage is available only with these conventional first mortgage products.

First-time homebuyers don’t have to wade through the three loan program details on their own, however. FHFA also has a Homebuyer Program Wizard that considers individual circumstances and makes a recommendation.

FHFA told the Miami Herald that its volume jumped considerably last year – so much so that it stayed open 24/7 and increased assistance amounts.

In addition to Florida programs, a few national programs track assistance programs, including downpaymentresource.com, Zillow.com or themortgagereports.com – and possibly Google if a buyer types in the correct search terms. The assistance programs aren’t always easy to find, however, and first-time buyers may have to assertively ask for help.

While some lenders and sellers may case doubt on buyer assistance programs, they’re sometimes more reliable than loans from family or friends.

Assistance is “very trustworthy. … Borrowers are completely underwritten” to make sure they meet program requirements,” Charles White, who directs Florida’s programs, told real estate writer Lew Sichelman.

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