What if you could pay off your student loan debt and buy a home at the same time? Student loan debt relief up to $40,000 while becoming a first time home owner? Sounds too good to be true. For a limited time, the Maryland Mortgage Program is doing just that with a product called Maryland SmartBuy 2.0.
First time home buyers with existing student loan debt of $1,000 or more. The Maryland Mortgage Program defines a first time home buyer as someone who has not owned residential property in the last three years. Borrowers applying for the program will need to complete a Home Buyer Education class as required by the jurisdiction where the house is located. Classes are also available online.
How it Works
Up to 15% of the purchase price of the home can be used to pay off student loan debt, up to $40,000 in the form of a soft second lien. There are no payments due or interest accrued on the junior lien, and it is forgivable in full after five years. This means that first time home buyers who use the program will have their student loan debt paid off at closing and never have to worry about paying the money back; as long as they live in their new home for at least five years. Settlement cost and down payment assistance programs are also available.
Unlike previous student loan debt relief programs, Maryland SmartBuy 2.0 may be used to purchase any eligible home available on the market in Maryland. Borrowers must use an approved Maryland SmartBuy Lender and meet program qualifications. The balance of all outstanding student loan debt must be paid in full at closing (in cases where there are two borrowers, only one borrower’s student loan balance must be paid in full).
For more information visit the Maryland Mortgage Program or contact a Housing Opportunity Certified Realtor®. If you are looking for a HOC Realtor® serving Harford County, Baltimore County, or Cecil County, contact me here.
If you are thinking of selling, click here to find out what your home is worth with a free market analysis.