The Tennessee Housing Development Agency has awarded a $106,000 HOME Program grant to the Oak Ridge Housing Authority that will be used to help low-income families purchase a new home.
The Oak Ridge Housing Authority will use the funding to provide assistance up to $14,999 to cover down payment and closing costs for eligible first-time home buyers living in the city limits, a press release said.
“A down payment is often the biggest hurdle to overcome for working families wanting to buy a home,” THDA Executive Director Ralph M. Perrey said. “These funds will allow first-time home buyers who would otherwise be able to afford a mortgage payment to overcome that obstacle.”
ORHA Executive Director Maria Catron said the grant will be used to help low-to-moderate income families, with the exact amount awarded based on the gap needed to cover the buyer’s down payment and closing costs.
“A majority of lower-income buyers do not have the savings necessary for a downpayment, or to pay the closing costs,” Catron said in the press release. “So they don’t feel like they can buy. We feel like this will help open the door to for home ownership for people.”
Eligible residents must earn 80 percent of the area media income for Oak Ridge to qualify for the program. The purchase price of an existing home is limited at $168,000, while the purchase limit for new construction is $227,000. The homes must be located in Oak Ridge and be able to pass a home inspection. Buyers are also required to put in a minimum of 1 percent of the home’s value, with any costs outside of the closing costs qualifying, the press release said.
Catron said the housing authority has begun advertising the new program and is also working with current public housing residents to identify eligible applicants.
Catron said ORHA hopes to help at least seven households purchase a home with the grant funding.
The HOME program is funded by the U.S. Department of Housing and Urban Development and is administered in part in Tennessee by THDA. During the most recent funding round, THDA awarded 22 competitive HOME grants statewide totaling $6.9 million.
HOME grants must be used for the production, preservation, or rehabilitation of affordable housing for low and very low income families and individuals.