Washington Home Loan Programs for Veterans

The Washington State Housing Finance Commission (WSHFC) was created by the Washington state legislature in 1983. This announcement was no small feat, as there were four previous attempts to create such a commission since the 1970s.

The new commission was designed to help qualified borrowers get below-market-rate home loans. Today, it is described as a “publicly accountable, self-supporting team, dedicated to increasing housing access and affordability” for the citizens of Washington State.

The Washington Home Advantage Government Program

The WSHFC Home Advantage Program is offered to qualifying applicants who meet the program’s income restrictions and credit score requirements. The mortgages eligible under this program include most government-backed mortgage loan programs, including VA mortgages. These home loans are 30-year loans that may include down payment assistance of up to 4% of the first mortgage loan amount.

Who Qualifies For Home Advantage

There are a variety of requirements for this program, including FICO score and debt-to-income ratio guidelines. Applicants who have a total debt-to-income (DTI) ratio of 45.01%-50.00% with credit scores from 620-659 are not eligible to apply for loans under the Home Advantage Government program.

Applicants must attend a free Homebuyer Education Seminar and receive a certificate. Anyone who signs the Deed of Trust for the transaction must attend this seminar.

From the date of the Education Seminar certificate, borrowers have up to two years to contact a participating lender and start the mortgage loan process. You can only use this loan program to purchase eligible properties, which may include:

• Single-unit owner-occupied homes
• Townhomes
• Condominiums
• Manufactured housing

Those who apply for Home Advantage can also receive down payment assistance through the Home Advantage down payment assistance program (see below). You do not have to be a first-time homebuyer to use either program or both.

The WSHFC House Key Home Loan Program

The House Key home loan program is offered to those who qualify for the following home loan assistance programs offered via WSHFC:

• Opportunity
• HomeChoice Program
• Seattle
• ARCH East King County
• Tacoma
• Pierce County
• Veterans Down Payment Assistance
• Bellingham

As you can see from the above, those who are eligible to apply for Veterans Down Payment assistance are offered access to the House Key home loan program, but there are also opportunities for those who want to purchase “never occupied new construction” or homes in a community land trust with or without the above downpayment assistance options.

The WSHFC official site provides few details about the terms of the loan you can apply for as a qualifying veteran, but in general, you should know the following requirements:

• Attendance of an approved homebuyer education seminar (you must receive a certificate of completion)
• Applicants must be either a first-time buyer (someone who has not owned a primary residence in the last three years) or a buyer purchasing in a targeted area
• Applicants must meet income limits
• Purchase price limits apply

Borrowers can apply for this loan using their VA mortgage benefits. All loans are serviced by participating lenders in the network.

The Washington Veterans Down Payment Assistance Loan Program

The Veterans Down Payment Assistance program is a down payment assistance option offered as a second mortgage loan with a 3.00% interest rate (in FY 2020, these rates are subject to change and are listed as a reference only).

Qualifying veterans who apply for this program may have their second mortgage payments deferred for up to 30 years. This program can be used in conjunction with the Home Advantage or House Key program loans described above.

Who qualifies for this program?

• Veterans with an honorable discharge
• Veterans who were discharged for medical reasons
• Guard and Reserve members with honorable discharges
• “Never remarried” spouses and dependent children of veterans who have died

Applicants must either be first-time homebuyers or be purchasing property in a designated targeted area. Income caps apply and may change depending on the county where the home is located. Applicants cannot be approved until they attend a homebuyer seminar approved by the agency.