DC Open Doors is a long running program run by the DC Housing Finance Agency to help make owning a home in Washington, D.C. more affordable. The D.C. metropolitan area is notoriously expensive, with median prices of $809,500 for a single family detached home and $752,300 for townhouses. Rents are also known to be high. To make things worse, in 2018 to 2019 the price of single family homes went up by 10.9 percent and the price of townhouses by 11.9 percent. Homeownership is thus increasingly out of reach.
To address the growing problem there have been some changes to the DC Open Doors program.
The program is open to all neighborhoods and wards, to first time and repeat homebuyers, and to people who do not live in DC. There are two informational sessions each month at the DCHFA headquarters. The primary purpose of the program is to reduce or remove the barrier to homeownership created by high down payments and closing costs. Being able to afford a high down payment can also improve your chances of having a loan approved.
To be eligible for the program you need to have:
- A credit score of at least 640
- A personal income of no more than $145,560 (based off of the borrower, not the household)
- A debt-to-income ratio of no more than 50%
- A rate quoted with 0 points
- A maximum first trust loan of $484,350
There is no sales price limit.
Qualified applications will receive:
- Up to $2,500 in closing cost assistance, depending on your income, for HFA Advantage loans only
- Below-market interest rates
- A down payment assistance loan (DPAL) to cover the gap between the purchase price and the loan, which can cover the full amount of the minimum down payment
So, what has changed?
DC Open Doors 2019 Program Updates
In May, 2019, several changes were made to DC Open Doors to address the increasing housing costs. Please see the list below for the 2019 updates:
- The maximum mortgage amount for both conventional and HFA loans was increased to $484,350
- The maximum income was increased to $145,560
- Two grants were added to cover closing cost assistance on HFA Advantage loans. If your income is no more than $92,960, you can receive $1,500, whilst if it is no more than $58,100, you can receive $2,500. The lender will fund the grant at settlement and then be reimbursed
- HFA Preferred Products, provided by Fannie Mae, have been suspended
- The Down Payment Assistance Loan has been changed from a 5 year forgivable loan. The new product is a deferred 0% non-amortizing subordinate loan, that is now due 30 years from the date of closing or if you sell or transfer the property, cease to live there, or refinance your mortgage
- The program no longer covers the cost to record the Deed of Trusts for the DPAL loans
- Borrower income will now be the amount stated on the 1003 for qualifying purposes, greatly simplifying the process of reporting income
DC Open Doors also posts their current interest rates for FHA, FHA Plus and HFA Advantage loans regularly on social media.
So, is the program for you? If you have low to moderate income and good credit and are looking to purchase in the District proper (the program does not cover the Virginia and