Are down payment assistance programs a good idea?

They serve the purpose if one is short on cash. There are many different down payment assistance programs. Some are grants some are loans in 2nd or even 3rd position. The rates on the 1st are typically higher at least in Calif. So if you need the assistance there is nothing wrong with the programs. The guidelines are typically more flexible if you do NOT use down payment assistance.

They can be very good for someone who could easily make payments on a home loan but just cannot quite save enough for all the costs involved, even with 3 or 3.5% down payment. There may be $10,000 in closing costs, including required property tax and insurance impounds to boot. It is important to do so with a broker/lender with experience in working with the State or a local down payment assistance or grant program. You can check HUD.gov for homebuyer assistance programs in your State on a local level. I use the state of California's Cal HFA program a lot, and we are set up to do it smoothly, initially funding with our own money.They can recommend lenders in your immediate region, as can s9omeone from a local organization the provides down payment assistance to first time buyers.

As they have said; they definitely have a purpose in helping people on the lower income scale purchase a home. KS has a grant program(no repayment) to cover up to 4.5% of your down payment and closing costs. Another option for you would be to look at USDA. They offer 100% financing, there is no upcharge to the rate as with the KS grant and their mortgage insurance premiums were just lower, making it less expensive than the KS grant program. if you would like more info, I can be reached at 913-416-4964