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The Home Stretch - Down Payment Assistance Program

The City of Takoma Park’s Down Payment Assistance Program, called The Home Stretch, provides financial assistance to eligible individuals and families seeking to achieve homeownership.

Eligibility Requirements

  • Applicant must be a “first-time homebuyer.”  For the purposes of this Program, a first-time homebuyer is defined as one who has not owned property in the last five (5) years.
  • Applicant’s income must not exceed 80% of the Area Median Income (AMI) for Montgomery County, as published by the State of Maryland and the U.S. Department of Housing and Urban Development.  The median income for a family of four in Montgomery County as of April 2017 is $110,300.   Income limits for specific household sizes are provided in the chart below.
  • Applicant must successfully complete a homebuyer education course approved by the City of Takoma Park prior to receiving assistance.
  • The home, whether a single family attached or detached home or a condominium, must be located in the City of Takoma Park.
  • The home must successfully pass a certified home inspection.

Income Limits (Effective April 2017)

Family Size 80% Median
(Income Limit)
1 $61,768
2 $70,592
3 $79,416
4 $88,240
5 $95,299
6 $102,358
7 $109,418
8 $116,477

Residency Requirements

  • Applicant(s) will be required to certify that, during the five year affordability period:
    • The home purchased with assistance from The Home Stretch Program will serve as his/her/their principal residence.  Annual occupancy recertification must be made throughout the affordability period;
    • He/she/they will not own or purchase an additional dwelling of any kind; and
    • He/she/they will not sublease or otherwise rent his/her/their home, or any portion thereof, to another person(s).

Loan Structure and Requirements

  • Assistance is provided in the form of a 0% interest, deferred payment loan, forgiven at 20% per year after the first year of purchase.
  • If the home purchased with assistance from The Home Stretch Program is sold, refinanced, or vacated within the five year affordability period, the owner is responsible for repayment of the full amount of the loan that has not been forgiven.

Approved Homebuyer Education Courses

The City of Takoma Park approves homebuyer education courses offered by housing counseling agencies that are approved by the U.S. Department of Housing and Urban Development.  There are four such agencies with offices in Montgomery County:

Other Key Requirements

  • Only fixed-rate loans are acceptable for borrower financing.  Balloon payments, adjustable rate loans, subordinate financing, and owner financing are not acceptable.
  • Mortgage must be a Conventional, Portfolio, FHA, VA or CDA mortgage loan.
  • Loan term must be 10 to 30 years.
  • Housing cost cannot exceed 30% of the applicant’s gross income, based on the lender’s calculation.
  • All applicants must contribute at least $1,000 of their own funds toward purchase.
  • If applicant is receiving assistance from more than one program, written approval from the City of Takoma Park is required.
  • It is strictly prohibited for the same person to act as Agent and Lender in the same transaction.

Application Process

Interested applicants must complete an Online Interest Form.  A member of the Housing and Community Development staff will respond with additional information within 48 hours of receipt of the form.

Questions?

Please direct your questions to City staff in the Division of Housing and Community Services at housing@takomaparkmd.gov or 301-891-7119.

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