CUYAHOGA COUNTY, Ohio — As home prices continue to climb in much of Northeast Ohio, a new grant program in could offer some relief for low to moderate-income homebuyers starting March 1.
Those who qualify for the "Welcome Home Program" in Cuyahoga County can receive up to $20,000 and military households up to $25,000 to use towards a down payment and/or closing costs.
"Owning your own home, that’s the American dream, right?" Damon Allen, chief marketing and community investment officer at the Federal Home Loan Bank of Cincinnati, says. "But it's getting more and more expensive."
Allen told 3News the initiative — which is bank is supporting — is for homebuyers who make 80% of the general median income in their county. For Cuyahoga County, that's $75,200 for a household of one to two people, or $86,480 for a household of three or more.
"The need for that subsidy is even greater now because homeowner affordability has gotten more difficult," Allen explained.
According to Allen, Federal Home Loan Bank is required by statute to set aside 10% of their earnings each year for grants to help people buy homes. In 2023, Allen says provided grants in excess of $16.3 million on behalf of more than 1,600 households.
"What that down payment assistance does is make the mortgage more affordable," he added.
Those who qualify can work with any of the bank's members in the county, including KeyBank, American Mutual Life Association, and Bank of Cleveland. You can find a full list on the bank's website.
Home prices jumped during the pandemic, and they've steadily climbed since. According to Zillow, the average value of a home in Cuyahoga County in December 2023 was $186,964, a 6.3% increase from the previous year and a 41% jump from the end of 2019. Allen says member banks are seeing the struggle for many to buy homes in this market in their own numbers.
"They're originating less mortgages because there are less qualifying households, so the interest rates definitely hurt the affordability of a home purchase," he remarked. "I think the demand is still there, right? Everybody wants to own a home, but their ability, as you noted, to afford it is challenging now."
In a statement to WKYC, Cuyahoga County said, it "looks forward to the additional infusion of funds provided by the Federal Home Loan Bank, to our community to increase homeownership."
"The County currently provides down payment assistance to low-moderate income homebuyers with a portion of the federal funds received," officials added. "This program as well as the State of Ohio’s new Homebuyer Plus program will provide greater opportunities for those seeking to purchase a home and create generational wealth for families that otherwise would not have access."
The Federal Home Loan Bank of Cincinnati provided the following abbreviated program guidelines:
- The total income for all occupants must be at or below 80 percent of the Mortgage Revenue Bond (MRB) limit for the county and state where the property is located;
- Homebuyers must contribute at least $500 of their own funds towards down payment and/or closing costs on a primary residence;
- All first-time homebuyers are required to complete a homeownership counseling program;
- Grant funds are intended only for homebuyers who qualify for the first mortgage based on their own merit. Co-signors and non-occupant co-borrowers are not permitted;
- The maximum interest rate for the first mortgage may not exceed 10.75 percent; and,
- All eligible property assisted with WHP funds is subject to a five-year retention mechanism, which may require the household to repay all or a portion of the subsidy, if the home is sold or refinanced within five years from the closing of the transaction.