Virginia Housing Development Authority (VHDA)

VHDA is Virginia's first-time homebuyer program. This program offers a special interest rate for homebuyers. To qualify you must have never purchased a home before, earn less than the prescribed income limits and stay within the guidelines of credit and home purchase price.

The income limits for a VHDA loan increase slightly depending on the number of family members living in the household. Typically these limits start at $50,000 for a two-person household. The limits for the prices of a home are $114,500 for a resale and $142,000 for new construction.

VHDA has two basic programs:

VHDA Plus - This program requires a 1% down payment. All closing costs are financed in the loan. A seller may pay some of the purchaser's closing costs if it can be negotiated in the contract.

VHDA Step - This program offers a break on the interest rate in the first 2 years of the loan. For example, if the current 30-year interest rate is 8%, a VHDA Step loan would have a 1st-year rate of 6%, a 2nd-year rate of 7% and the final 28 years of the loan would be based on the 8% market rate.

The Step program allows a homebuyer to grow into their monthly loan payment. A 3% down payment is required.

The features of a VHDA loan are:

• Income limits - based on size of family, starting at $50,000 per year
• Home price - $114,500 resale and $142,000 for new construction
• Loan limits: 29%/41%
• Mortgage Insurance Premium on loans with down payment requirement: 1% or 3% depending on program
• Can be assumed by a qualified purchaser