Delaware First-Time Homebuyer Programs in 2022

  • The Delaware State Housing Agency (DSHA) offers down payment assistance and tax credit options.
  • To receive financial aid from the state agency, you must meet specific income requirements.
  • If you plan to buy a home in New Castle County, explore the local down payment assistance program.
  • Read more stories from Personal Finance Insider.

First-time homebuyers in Delaware may want to consider state or county assistance when applying for a mortgage. State and local agencies provide down payment loans and resources if you need help covering additional costs in the homebuying process.

We’ll provide an overview of the different programs available in the state and how to determine if you qualify for aid.

DSHA down payment assistance 

The DSHA helps homebuyers get a 30-year fixed-rate conventional, VA, FHA, or USDA mortgage with a low interest rate. 

If you get a DSHA Homeownership Loan, you also might be eligible for down payment assistance from the state agency. You can get from 2% to 5% of your mortgage in the form of a 0% interest forgivable loan. This means you’ll pay for the loan only if you decide to sell, refinance or transfer your home.

To be eligible for the loan, you’ll need to meet the following requirements:

  • You have a minimum credit score of 620
  • You meet the income limit requirements for your county
  • You plan to borrow less than $417,000 

How to determine if you meet the income limit requirement

The following chart will help determine whether you meet the income limit requirements necessary to apply for the DSHA Homeownership Loan. 

DSHA tax credit

If you’re a first-time homebuyer in Delaware, you can also claim a special tax credit of up $2,000.

To receive the tax credit, you must fulfill the following criteria:

  • You plan to move into your home in the first 90 days of buying your home and make it your primary residence 
  • You meet the income limits for your county
  • Your home is less than the purchase price limit for your county

How to determine if you meet the income limit requirement

The chart below shows the maximum household limits to qualify for the special tax credit.

If you’re not sure whether the home is in a target area, use this search tool by the Federal Financial Institutions Examination Council (FFIEC), which shares Census data.

How to determine if you meet the purchase price requirement

Below you’ll see the maximum purchase price limit for each county to still be eligible for the DSHA tax credit.

New Castle County has a higher purchase price limit than other counties because the median housing price is higher.

How to apply for a DSHA program

To apply for a DSHA program, reach out to a participating lender from this list. The lender will walk you through the home buying process and verify if you’re eligible for state assistance.

New Castle County down payment assistance

New Castle County offers down payment assistance if you’re a low-to-moderate income first-time homebuyer.

Through the county’s Down Payment Settlement Program, you may receive a 0% interest 8-year loan of up to $5,000.

To be eligible for the loan, you must meet the following requirements: 

  • You have a debt-to-income ratio under 52%
  • You can contribute at least $500 for your down payment
  • You plan to buy a home with a purchase price under $379,500
  • You plan to have the home inspected by a certified inspector during the homebuying process
  • You meet the household income requirements
  • You have attended a Homeownership Education Program

New Castle County uses data from the US Department of Housing Department if you qualify. Use this chart to see if your family meets the county’s requirements.

To apply for the New Castle program, reach out to a housing counseling agency using this HUD search tool.


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