Handy Explains Property Grants – Getting Free Government Money for Houses


According to Handy, it is possible to get government grant money that you can use to build your first house. Typically, these come from state agencies and nonprofits in the form of forgivable mortgages, down payment assistance mortgages, closing assistance programs, tax credits for first-time home buyers, and more. The only catch is that you need to qualify for the programs and there is only a limited number of grants available in each area and year.

The Grants

Here are the different types of grant programs that you can apply for to build your first house:

  • Down payment assistance mortgages – Down payment assistance mortgages are special loans that offer homebuyers the option to replace typical down payment with favorable or below-market mortgage rates. For instance, eligible homebuyers can get down payment assistance mortgages at only 1 percent with 10 years to pay the amount back.

There are other forms of down payment assistance mortgages known as deferred mortgages that don’t require the homeowner to repay the mortgages as long as they still live in the house. So, you have the option to pay back the mortgage only when you want to sell the house or refinance it.

The Down payment Toward Equity Act is a government grant that allows first-time homebuyers the option to be eligible for up to $25,000 for paying closing costs, making down payment, and more.

  • First-time home buyer tax credit – These include mortgage credit certificate (MCC) programs that make it easier to afford your first house. Unlike typical grants, tax credits allow homebuyers to save dollar-for-dollar tax credits on their mortgage interest for up to $2000 every year. Plus, you also get to enjoy benefits offered by the state and federal governments on a rolling basis.
  • Forgivable mortgages – One of the popular housing grants offered by the National Homebuyers Fund, DPAs, and Housing Finance Agencies (HFAs) includes forgivable loans that erase the liability of repayment after a certain amount of predetermined time period.

For instance, suppose you take up a forgivable loan of $12000 and you repay your primary mortgage as agreed over a period of 5 years. Then, the secondary $12000 loan would be forgiven by the lender with no interest due or no payments made.

These are supported greatly by communities and municipal government since these promote neighborhood development, long-term homeownership, community investment, and more.

  • Closing costs assistance programs – You can contact your local housing agency to check whether you are eligible for closing cost assistance programs stimulus plans. Typically, such programs are targeted toward home buyers with average credit scores and lower income.

However, if you become eligible for such programs you can receive up to 100 percent assistance for meeting various closing costs such as mortgage fees, transfer taxes, title expenses, and more.


Handy suggests you apply for the Good Neighbor Next Door (GNND) program if you are a teacher working pre-kindergarten through 12th grade, a firefighter, a law enforcement officer, or an emergency medical technician. The GNND program allows a 50% discount for eligible homebuyers on the purchase of their home.