Northampton County Grants

House with a sold signThe Northampton County First Time Home Buyer Program offers financing to qualified first-time home purchasers in Northampton County.
These loans offer up to $5,000 to assist with the purchase of a home and closing expenses.
The house must be in a county region where at least 42 percent of the inhabitants have middle-incomes or less. This comprises the cities of Easton and Bethlehem, as well as portions of almost every other municipality in the County.

The home-buyer aid takes the form of a forgiven debt on the subject property for a period of five years, or until the property is sold. For each year you live in your house, 20% of your debt is forgiven. If the homebuyer remains in the residence for at least 5 years, the debt is fully erased.

General Overview:
1. You must be a first-time home buyer or have been out of the market for at least three years.

2. The home you want to purchase must be in an area that qualifies based on the income of the inhabitants.
Easton and Bethlehem, as well as portions of almost all other Boroughs and Townships, are eligible.

4. Your first mortgage must be obtained from one of the partner financial institutions.

5. Before closing, you must complete a HUD-certified home-buyer education counseling program from an authorized organization.

6. Your yearly household income cannot exceed 80% of the Lehigh Valley median income, as calculated by HUD. See income limit char

There is no limit on the price of the home you are purchasing, but the lender will determine if the primary mortgage and escrow costs are within your ability to pay.

The applicant must contribute a minimum of 1.5% of the lesser of the purchase price. These funds must come from the applicant’s assets, which must be verified in a deposit account by an institution of depository, or constituted by cash on hand, for a minimum of three (3) months prior to the settlement date.

At the time of settlement, the buyer’s liquid assets may not exceed the total of 3% purchase price. Any amount above the 3% must be applied to the purchase of the home, e.g. a person can have a total of 4.5% of the sale price in liquid assets, use 1.5% as a down payment, and keep the remaining 3%.

Applicants must need the subordinated mortgage to afford the house.

Repayment of Loans
The subordinated mortgage will be repaid if the homeowner stays in the house for five (5) years. However, if a homeowner resells their property during that five (5) years, they must repay the subordinated mortgage. The initial principal amount of the loan is due and payable in full upon settlement under this transaction.
If the original mortgage is refinanced, the Northampton County mortgage may be subordinated to the new primary mortgage. In the event of an arms-length sale and if the net proceeds from the sale are insufficient to satisfy the obligation, the subject premises shall be released from the lien and operation of the written mortgage, though the borrower shall remain personally obligated to repay the unpaid loan in such event.

Credit counseling & First Time Home Buyer Classes in Northampton County PA