The City of Federal Way is expanding its program to help transform foreclosed properties into community assets. Both the income limits and the geographic areas available have been opened up to allow more potential first-time homebuyers to qualify.

Families of three or more making up to $97,000 now qualify, as do one-to-two person households making up to $90,000. In addition, the program is no longer restricted to certain census tracts. Buyers may purchase foreclosed properties anywhere within city limits. The program calls for loans with 0% interest, no payment and a loan deferral of 15 years.

The maximum loan amount is $50,000.

Other qualifications for the “House Key Federal Way” down payment assistance program:

• Repayment is due at the time of sale, transfer, or refinance within first 15 years
• The property purchased must be foreclosed, bank-owned, 90+ days delinquent, or abandoned
• Loan is forgiven at end of 15 years, but a loan payoff is not pro-rated prior to 15 years
• The property must be located in Federal Way
• Borrowers must attend pre-purchase counseling and home buyer education sessions
• The home must be the primary residence of the purchaser
• House Key Federal Way down payment assistance is a 2nd mortgage loan

Must be used with the WSHFC’s House Key First mortgage program.

The City launched House Key Federal Way last November in conjunction with the Washington State Housing Finance Commission (WSFHC) to help neighborhoods in Federal Way that have been impacted by high foreclosure rates.

“The program was initially limited to lower income brackets and only certain census tracts,” said Kolya McCleave, the City’s Community Development Block Grant Coordinator. “Now that the income limits are higher and the eligible properties have been dramatically expanded, the program is much more accessible to a broader range of residents.”

Potential buyers should act now—home sales need to be under contract by June

Potential buyers are urged to contact WSFHC, 800.767.4663, as soon as possible.

With the program ending in September, the bulk of home sales need to be under contract by June.

The $651,688 set aside for the effort is part of the federal Neighborhood Stabilization Program and is expected to assist 19 first-time home buyers purchase foreclosed or bank-owned homes in designated areas of Federal Way. For more information, contact the WSFHC or visit www.wshfc.org.