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Buy Worcester Now Programs

First Time Homebuyer Down Payment Assistance

Currently, the City of Worcester has a total of $300,000 established for first time homebuyer down payment assistance and corresponding core systems rehab for income qualified individuals and families.

Program Overview

The City of Worcester's Executive Office of Economic Development, through its Housing Development Division, offers financial assistance to low-to-moderate income first time homebuyers through the Division's Down Payment Assistance Program. Under the program, eligible down payment and closing costs are paid for with funds available under the US Department of Housing & Urban Development's (HUD) Community Development Block Grant (CDBG) program.

Individual Qualifications

Applicants must be first time homebuyers. A first time homebuyer is defined by HUD as:

  • An individual and his/her spouse who have not owned a home during the three-year period prior to the purchase of the home assisted under the Program.
  • A single parent, defined as an individual who is unmarried or legally separated from a spouse who is pregnant, has custody of one or more minor children, or who shares joint custody.
  • A displaced homemaker, defined as an individual who is a legal adult, has not worked full-time for a full year in the labor force over a period of years, but has during such years, worked primarily without remunerations (wages) to care for the home and family; and is unemployed or under-employed and experiencing difficulty in obtaining or upgrading employment.
  • An individual that has owned a property not in compliance with State, Local, or model building codes that cannot be brought into compliance for less than the cost of constructing a permanent structure.

Additionally, all applicants must qualify for a mortgage through a lender of their choice.

Homebuyers will be required to provide down payment. A minimum buyer contribution of 1.5% of the total purchase price of the home will be required from the borrower's personal liquid assets for borrower cash reserves. The following stipulations are applicable:

  • The maximum down payment assistance to be offered will not exceed $10,000.
  • CDBG funded down payment assistance cannot exceed 50% of the down payment required through the purchase of the property.
  • Gift funds may be used to meet the 1.5% down payment requirement, but gift funds cannot be used to exceed a 3.5% down payment.
  • Gift funds may come from immediate family, employer, or nonprofit agency with required documentation.
  • Gift funds cannot come from any loan source.
  • 51% of 3-4 family homes must be low to moderate income.
  • Funding can also be used towards rehabilitation that is completed in conjunction with a home purchase; eligible rehabilitation includes, but is not limited to, the cost of lead paint reduction as well as remediation of other in-home health hazards.
    • Required rehabilitations must be completed within one year of home purchase, and may be subject to City inspection; all proper documentation must be provided and work must be done by a licensed contractor.
  • Borrower reserves must be seasoned for at least a full 3-month period and shall be based on the average daily balance of the account.

In order to qualify, applicants must be 80% of Area Median Income or less (refer to table below):

Household Size 80% of Area Median Income Limits
Adjusted for Household Size
1 $44,750
2 $51,150
3 $57,550
4 $63,900
5 $69,050
6 $74,150
7 $79,250
8 $84,350

A home purchase price must not exceed 95% of the City's median sales price, currently $234,000 for a single family home, $299,000 for a 2-family structure, $362,000 for a 3-family structure, and $449,000 for a 4-family structure.

Property Qualifications

  • To qualify, the home must be a 1-4 family home or a condominium, either attached or detached, within City limits with a purchase price not exceeding 95% of the City's median sales price (currently valued at $234,000 for a single family home).
  • The home must constitute the applicant's primary residence and may only be used for residential purposes.
  • In determining the amount of program assistance, the City requires all reasonable available liquid assets of the applicant be applied towards the down payment.
  • Properties built prior to 1978 must be inspected for the presence of lead-based paint hazards.

Additionally, funding can be utilized to assist existing homeowners with the rehabilitation of housing core systems in order to bring the property up to local codes and standards. Additional rehabilitation funding may be allocated through the Down Payment Assistance Program for core systems repair if need is adequately demonstrated.

Adequate need for rehabilitation will be determined through a required HUD Housing Quality Standards checklist, as well as through the individual buyer's home inspection report. Eligible forms of CDBG funded rehabilitation includes heating and water systems rehabilitation, handicapped accessibility improvements, and emergency repairs, such as repairs to a roof that is leaking.

The amount of CDBG funding allocated is left to the discretion of the City of Worcester's Housing Development Division, and will be determined by the procurement of no less than three (3) rehabilitation quotes by the property owner. Upon reviewing the quotes for cost-reasonableness, the City may reimburse the homeowner the amount of funding needed to complete the rehab work in accordance with the lowest and most responsible quote provided.

Application Process

  1. Prospective homebuyer should contact the City of Worcester Executive Office of Economic Development, Housing Development Division at (508) 799-1400 to determine if he or she meets program qualifications.
  2. Prospective homebuyer secures approval for a mortgage through a lender of their choice.
  3. Applicant completes a homebuyer course through an approved counseling agency. Verification of course completion is required as part of the application. See bottom of this page for homebuyer courses.
  4. Participant selects a home and conducts all necessary home inspections required by application.
  5. Applicant, either individually or through lender, submits all required materials for review, as indicated in the application.
  6. Upon approval of the application, the City of Worcester will issue a conditional letter of funding good for 90 days.
  7. The funds will be provided at closing to either escrow or the title company.

View and download a copy of the City of Worcester's Down Payment Assistance Application Form.

Once completed, please return the application to:

Housing Development Division
Executive Office of Economic Development
City of Worcester
455 Main Street, Room 405
Worcester, MA 01609

Completed applications can also be faxed to (508) 799-1406, or emailed to development@worcesterma.gov.

If you have any questions or would like more information, please call the Buy Worcester Now Hotline any time, day or night, at (508) 799-1902.

Worcester Energy Rebate Pilot Program

Program Overview

Properties with insufficient/uneconomical heating and cooling systems may be eligible to receive up to $5,000 in grant funding in order to fund certain energy improvements through the City of Worcester's Worcester Energy Program. For more information on program qualifications, or to obtain an application, please visit www.worcesterenergy.org or call the City of Worcester's Division of Planning & Regulatory Services at (508) 799-1400.

Worcester Lead Abatement Program

Program Overview

Properties that have lead-based paint hazards may be eligible for grant funded assistance for lead abatement services through the City of Worcester's Lead Paint Abatement Program. In order to obtain more information regarding the program, applicants are encouraged to contact the City of Worcester's Division of Housing Development at (508) 799-1400, or through the City of Worcester Website.

Additional Resources - First Time Home Buyer Education Classes and Mortgage Foreclosure Prevention Counseling

NeighborWorks HomeOwnership Center of Central Massachusetts

In order to qualify for down payment assistance, applicants must complete a homebuyer course through an approved counseling agency. NeighborWorks offers a free orientation and offers a first-time homebuyer education course with certification as well as credit counseling and budgeting. NeighborWorks also offers mortgage foreclosure prevention counseling. For more information regarding these programs, applicants are encourage to go to contact the NeighborWorks HomeOwnership Center of Central Massachusetts at (508) 791-2170, or through www.hoccm.org/.

Massachusetts Affordable Housing Alliance

MAHA offers similar programming. More information can be found at www.mahahome.org/takeaclass. MAHA also provides affordable home listings for first time home buyers at www.massaffordablehomes.org.

Citizens Housing and Planning Association

CHAPA offers homebuyer workshops. More information can be found at www.chapa.org/looking-for-housing/homebuyer-workshops.

Worcester East Side CDC

Housing counseling services can be found at www.worcestereastsidecdc.org.

Resources for Communities and People

Housing counseling services can be found at www.rcapsolutions.org.

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