Gov. John Carney and Delaware State Housing Authority Director Anas Ben Addi announced the launch of a new homeownership program for recent college graduates at an event recognizing Homeownership Month.
The new program, Homes for Grads, will offer discounted rates on DSHA’s down payment assistance loans for homebuyers who have graduated college with a four-year degree or higher in the last three years.
Joining Carney and Addi to launch the program were elected officials, higher education officials, realtors, lenders and housing counselors.
Homes for Grads will provide a reduced mortgage rate of 50 basis points or one-half of a percentage for recent college graduates when they are accessing one of DSHA’s Preferred Plus loans which include down payment and settlement assistance.
“Having an educated workforce is critically important to our state, but one of the economic development challenges we face is attracting college graduates to our state and keeping them here,” said Carney. “The Homes for Grads program is another incentive we can offer to encourage these graduates to make Delaware their home. We think this can have a lasting impact on our state’s economic wellbeing by encouraging our best and brightest residents to stay here in Delaware, contributing to our economy and to our communities.”
With the cost of a college education continuing to rise each year, many graduates will leave school with student debt, including 65% of Delawareans. This debt can be a significant barrier to affording monthly payments and saving for a down payment.
Homes for Grads is being funded with a $10 million commitment from DSHA and will be subsidized by revenues from DSHA’s primary homeownership loan programs. In addition, the program is financed with support from Discover Bank.
DSHA will work with its participating lenders to offer the Homes for Grads program to recent college graduates. Tracy Chongling, vice president of mortgage lending at Guaranteed Rate, a participating DSHA lender, said she sees potential in the new Homes for Grads program.
Buyers who participate in the Homes for Grads program must meet eligibility requirements for DSHA’s homeownership loan programs, including credit score and income limits. They will be required to have a minimum credit score of 620. If their credit score is not at this number, DSHA offers financial coaching to help buyers improve their score and get on the path to homeownership.
In correlation with the launch of this new program, DSHA is also adjusting the income levels for its homeownership programs in order to provide more opportunities for residents to purchase homes in Delaware. The new income limits are based on the area median income for Delaware’s three counties and are tied to the number of people living in a household. Previously, DSHA used a flat household income limit for all buyers. The new income limits can be found at bit.ly/2Xhc4Tq.
Recent college graduates who are interested in learning more about how to participate in Homes for Grads should visit bit.ly/2Xhc4Tq or contact a participating lender. A list of lenders is available at kissyourlandlordgoodbye.com/lenders.