A Guide to West Virginia Housing Development Fund Mortgage Programs

Entry-level wages, student loan debt, and a short credit history may be some of the reasons affordable homeownership seems out of reach for many young West Virginians. But programs through the West Virginia Housing Development Fund have helped reduce these and other barriers to homeownership for thousands of homeowners across the state over the past 40 years. 

The West Virginia Housing Development Fund is a state housing finance agency, which makes us unique among other lending institutions you may encounter. Unlike a bank, credit union, or independent mortgage company, we sell tax-exempt mortgage revenue bonds to fund our mortgage programs. This allows us to offer interest rates generally below market value, which is a savings to our borrowers. Additionally, we offer down payment and closing cost assistance to help further reduce common barriers to homeownership.

Read on to learn more about our mortgage programs and how they can help you achieve your dreams of homeownership.

The Homeownership Program: Financing for Lower-income Buyers in West Virginia

We know that entering the housing market for the first time can be intimidating, and costs may seem out of reach. However, the Fund’s signature Homeownership Program is often a great fit for first-time buyers. 

Here are a few things you should know about the Homeownership Program:

• It offers 30-year, fixed-rate loans at our lowest interest rates and can finance up to 100 percent of the home’s purchase price.
• It’s designed for lower-income first-time buyers. Information on income limits can be found here. First-time buyers are those who are purchasing their first home, buying in a targeted county, or those who have not held ownership interest in their primary residence for the past three years.
• There are sales price limits, too, based on the county of purchase and the number of people in the household. Learn more about price limits.
• In addition to single-family homes, the Homeownership Program can finance townhomes, condos, dwellings in Planned Unit Developments, and new or existing manufactured doublewides on permanent foundations. The program only applies to homes purchased in West Virginia on lot sizes of five acres or less.
• Borrowers using the Homeownership Program also qualify for down payment and closing cost assistance through our Low Down Home Loan. More on that program below. 

Movin’ Up Program: Competitive Fixed-Rate Mortgages for West Virginia Buyers

Most of the time, your first home is not your forever home. We have just the program for current or first-time homeowners who need a little more space at a higher purchase price.

Here are a few things to know about the Movin’ Up Program:

• It is available to moderate-income first-time or repeat homebuyers. Even if you currently own a home or have in the past, you can still qualify for a Movin’ Up loan. 
• The Movin’ Up Program offers competitive interest rates on 30-year, fixed-rate mortgages.
• We recently increased our income limits and established a statewide sales price limit. Learn more about the Movin’ Up program income limits here. 
• Borrowers using the Movin’ Up Program also qualify for down payment and closing cost assistance through our Low Down Home Loan. See below for more information on that program. 
• In addition to single-family homes, the Movin’ Up Program can finance townhomes, condos, dwellings in Planned Unit Developments, and new or existing manufactured doublewides on permanent foundations. The program only applies to homes purchased in West Virginia. There is no acreage limit with this program.

Low Down Home Loan: Down Payment and Closing Cost Assistance in West Virginia

A common barrier to homeownership is the up-front costs associated with your loan. Depending on the type of loan, borrowers may be required to pay a down payment that is a set percentage of the total cost of the home. For example, FHA loans generally require a 3.5% down payment, so a down payment on a $200,000 home would be around $7,000. Then there are closing costs, which are the fees associated with processing and closing the loan. This may include attorney fees, loan origination and appraisal fees, and prepaid costs such as property taxes.

As you can imagine, these costs can quickly add up for younger first-time or even established repeat homebuyers. That’s where the Low Down Home Loan comes in. 

Here’s what you need to know:

• The Low Down Home Loan is only compatible with the Fund’s Homeownership Program or Movin’ Up Program. It cannot be paired with loans originated outside of West Virginia Housing Development Fund mortgage programs.
• Buyers may borrow up to $12,000, repaid at 2% over 15 years. The funds may be used to cover down payment, closing costs, and other eligible fees. 
• The Low Down Home Loan is a second deed of trust in addition to the buyer’s primary (Homeownership or Movin’ Up) mortgage. Depending on the amount borrowed, this second loan only adds about $72 to the monthly mortgage payment while reducing the amount of money borrowers pay at the closing table. The funds may be used to cover down payment, closing costs, and other eligible fees. 

A Note About Servicing

Another thing that makes the West Virginia Housing Development Fund unique is that we service all of our loans. That means from loan closing to payoff, everything associated with your loan will be handled by one of our experienced Loan Servicing staff in our Charleston office. Anytime you have a problem or a question about your loan, you’ll call a local number and speak with someone in Charleston who can work with you to resolve your issues. 

Who Qualifies for a West Virginia Housing Development Fund Loan?

Program eligibility varies, but generally, borrowers should have a credit score of at least 620 and show income sufficient to repay the loan. Interest rates on our loans are not affected by your credit score. Borrowers will have the same interest rate whether their score is 620 or 800, and that rate will be locked in for 30 years or until the loan is paid in full. 

For more information or questions about your specific circumstance, give us a call at 800-933-8511 or reach out to a Partner Lender in your area.