As mortgage rates drop and first-time homebuyers plunge into the market, a variety of nonprofits and new state programs stand ready to help.
“As word gets out, that is causing folks to say, ‘Hey, maybe I can achieve the dream of homeownership,’” said Darryl Smith, executive director of the Seattle-based homeownership nonprofit HomeSight. “The big question is how to get started.”
Staff of first-time homebuyer programs say the most important first steps are education, understanding your financial situation and identifying possible sources of assistance.
Assistance programs
Homes in Clark County average $535,000, according to the latest Regional Multiple Listing Service report.
“I think a lot of people see the average cost of homes or they open Zillow and they’re like, ‘I could never afford this,’” said Heather Cochrun, director of community engagement and impact at Evergreen Habitat for Humanity, which helps people buy the homes the nonprofit builds.
But there are still about 80 homes sold for under $400,000 in Clark County every month. Although those homes often need repairs or are small, buying a home is a way to build generational wealth and stabilize housing payments, HomeSight’s Smith said.
“I think something magical happens when you end up becoming a homeowner. … When you know what your payments are going to be, you’re no longer subject to rent shooting up dramatically,” he said.
For a household making below the median income ($116,900 in Clark County), $400,000 can still be out of reach without savings for a down payment.
However, people making below $180,000 a year with a credit score of at least 620 can receive thousands of dollars in down-payment assistance, usually up to 3 to 5 percent of the purchase price, according to Washington State Housing Finance Commission.
Through the Home Advantage Downpayment Assistance program, a homebuyer can receive up to 3 or 4 percent of the total loan amount or up to 5 percent using a Home Advantage conventional or Federal Housing Administration loan. The program has a zero percent interest rate and defers payments for 30 years. Households in Clark County that make less than $115,900 a year may be eligible for a loan of as much as $10,000 with a 1 percent interest rate and deferred payment for 30 years.
Households of one or two people that make less than $75,550 or households of three or more people that make less than $94,400 may receive up to $15,000 through the Opportunity Downpayment Assistance Loan Program if they buy in one of eight low-income areas in Clark County.
The state also provides down-payment assistance for veterans, people with disabilities and people whose families faced housing discrimination in Washington.
The Covenant Homeownership Act, passed in 2023, can provide up to 20 percent of a down payment for people with parents, grandparents or great grandparents who lived in Washington before April 1968. (That’s the year the Fair Housing Act made racial discrimination in housing illegal.)
Those family members must be Black, Hispanic, Native American, Alaska Native, Native Hawaiian or other Pacific Islander, Korean or Asian Indian, according to the program.
It can be difficult to know which program or combination of programs is best. People also may not have the credit score to be eligible for these programs. But there are nonprofits and organizations that can help guide people through the process and even provide their own financial assistance.
What help is available?
HomeSight, the Native American Youth and Family Center, Save First and the Washington State Housing Resource Center can help people understand the homebuying process
People can also take homebuyer education seminars for free through the state, which is a requirement for state homeownership loans anyway.
Jumping into working with a mortgage company, especially a large one found online, before receiving housing counseling is one of the biggest mistakes someone trying to buy their first home can make, experts said.
“Frankly, you might get a ‘no.’ It might be really discouraging. It might set you back. We have many people in the community that think that they can never become a homeowner,” Smith of HomeSight said.
Cochrun with Evergreen Habitat for Humanity said understanding someone’s credit score is an important first step before applying for a loan. She often refers people to Save First, which teaches people how to improve their credit and techniques for paying off debt.
HomeSight also works with people to improve their credit and stabilize their financial situation before applying for a loan. After that, HomeSight searches for programs and funding for potential homebuyers.
In Clark County, HomeSight has two down-payment assistance programs that may give homebuyers as much as $35,000, Smith said.
Before getting ready to buy a home, Smith recommends avoiding big purchases, like a new car, or running up credit-card debt.
“We want to make sure things are nice and stable and remain kind of the same for a little bit,” he said.
Cochrun recommends new homeowners take repair and maintenance classes to avoid costly emergencies and keep the home in good condition.
“A lot of people don’t know outside of cleaning floors there are other things that maintain the longevity of your home as well,” she said.
