Keystone Home Loan Programs
The program that is best for you will depend on your specific circumstances, such as your credit history and amount of cash savings, as well as your individual preferences. A PHFA approved homebuyer education provider or participating lender can help you decide.
Start living your dream today; find out if you're eligible for a low-rate, 30-year fixed PHFA home loan.
You may be eligible for a Keystone Home Loan if you meet the following six conditions:
- You are not a first-time homebuyer, but you plan to buy a home in a Targeted county or area; or, you are a discharged veteran of the United States Armed Forces. Target counties are indicated by a "T" in the listing of Purchase Price and Income Limits. Please note that some Non-Target counties have targeted neighborhoods within them. Those areas are listed by county and census tract starting on page three of the purchase price and the income limits above. To determine the census tract of a specific property, visit www.ffiec.gov, and select 'Geocoding/Mapping System'.
You and all other adults who intend to live in the home within 12 months from closing are first-time homebuyers. This is defined as someone who has not owned (had Title to) their principal residence during the previous three years.
- The gross annual household income for all adults that intend to occupy the home within one year from loan closing does not exceed the Keystone Home Loan Program income limit. All sources of income must be included, except for income received by persons under age 18 and income received by dependants enrolled in a full-time undergraduate program.
- The purchase price of your prospective home does not exceed the Keystone Home Loan Program purchase price limit. This includes all costs for a complete home. It is also known as the total acquisition cost. The appraised value of land owned outright for more than two years does not need to be included.
- You have an acceptable credit history and the ability to make monthly payments on the home you expect to buy. Generally, you should plan to use no more than 30 percent (30 %) of your income for your monthly mortgage payment. A participating lender or PHFA network counseling agency can help you determine how much of a home you can afford, as well as any credit issues you may need to work on.
- You have sufficient funds to pay standard mortgage application and closing fees. Check with a PHFA participating lender to determine the specific costs. These would commonly include such things as credit reports, appraisals, title fees, etc.
- You have sufficient funds for a downpayment on your prospective home. Borrowers who have a downpayment of less than 20 percent (20 %) of the home’s purchase price or appraised value are required to obtain mortgage insurance to protect the lender and PHFA in the event that the mortgage becomes delinquent (you fall behind on your payments). The amount of the downpayment differs according to the loan type as listed below.
Conventional uninsured loans: Conventional loans currently require a 20 percent (20 %) downpayment under the Keystone Home Loan program, regardless of the credit score. The downpayment can come as a gift from an immediate family member (parent, sibling, child, grandparent, aunt or uncle) or a nonprofit organization.
FHA loans: These loans are insured by the Federal Housing Administration (FHA) and require a borrower to have a 3.5 percent (3.5 %) minimum investment.
VA and RD loan: VA and RD loan: Loans guaranteed by either the Veterans Administration (VA) or Rural Development (RD) require no downpayment in most cases. RD loans are not available in Philadelphia and Delaware counties and other major cities.
Borrower should be aware that not all participating lenders offer FHA, VA or RD loans. Also, those loan types may have additional eligibility requirements regarding the buyer and/or the property.
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If you meet the conditions above, call a PHFA participating lender to start your mortgage application. PHFA also offers homebuyers the opportunity to receive homebuyer counseling and education through one of its approved counseling agencies. We strongly encourage you to seek the assistance of a counselor before you sign a sales agreement, especially if you are a first-time buyer. Any borrower with a FICO credit score lower than 680 is required to complete a course prior to closing on their loan.