Down Payment Assistance
Program Background
The City of Tacoma Down-payment Assistance Program is funded by the Washington State Department of Commerce’s Housing Trust Fund. The program was developed based on recommendations from the City’s 2021 Homeownership Disparities Study. The study recommendations that informed the investment into this program were 1) the recommendations to build capacity for educators and service providers in the City, 2) to foster more opportunities for underserved households to purchase a home, 3) to help potential owners successfully move through the mortgage application process.
Program Description
The City of Tacoma Homeownership Down-Payment Assistance Program may provide a zero interest deferred 30-year loan to first time homebuyers who are at or below 80% AMI for the Tacoma/Pierce County metro area as defined by HUD. The loan is secured by a Deed of Trust recorded on the acquired property. The program provides households with a maximum of $60,000 per household to be used for down-payment assistance and/or closing costs.
When homebuyer loans are repaid, the program income from these repayments will be placed in a revolving loan fund where they will be used to serve additional low-income homebuyers with down-payment assistance.
Program Objectives
- Increase homeownership rates among undeserved Tacoma residents who are at or below 80% area median income.
- Improve opportunities to create generational wealth for underserved Tacoma residents in the City.
- Expand existing resources for homebuying for low to moderate income buyers in the City of Tacoma.
- Reduce racial homeownership disparities in Tacoma.
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To be eligible:
- Household Income must be at or below 80% area median income:
Household Size 1 2 3 4 5 6 Max Income (80%) $67,700 $77,350 $87,000 $96,650 $104,400 $112,150 - Front End Debt to Income Ratio = (Monthly Housing Expenses/ Gross Monthly Income)×100 (including taxes, homeowner’s insurance, Mortgage Insurance and HOA Dues / Fees (if applicable) cannot exceed 38%.
- Back End Debt to Income Ratio = (Total Monthly Det Payments/ Gross Monthly Income)×100 cannot exceed 45%.
- Be a first-time homebuyer (an individual nor the spouse or domestic partner of that individual may have owned a home in the three-year period prior to purchasing a home under this program); and
- Must complete the Washington State Housing Finance Commission (WSHFC) homebuyer course. The WSHFC homebuyer course is available virtually or in-person. For information, visit their website. Please obtain documentation verifying that you completed the course.
Please note these are general eligibility requirements only. This program requires underwriting of the borrower and any co-applicant and has requirements for the home that is to be purchased using the assistance. These additional program details will be discussed as part of the application and underwriting process.
- Household Income must be at or below 80% area median income:
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- Tacoma City Limits Address Verification
- Eligible Types of housing:
- Condominium units,
- Single family units (with or without detached structures),
- Townhouse units,
- Limited equity cooperatively owned homes, or
- Community land trust or land lease units.
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In June 2020, the Tacoma City Council passed Resolution 40622 formally acknowledging that the City of Tacoma’s existing systems have not adequately served the needs of Black community members and other community members of color. Pursuant to that resolution the City has prioritized anti‐racist approaches to the evaluation of new policies and programs as well as to the comprehensive and sustained transformation of present practices. Furthermore, in November 2020, the City Council passed Resolution 40697 that specifically authorized a study to examine the disparities of homeownership as a housing outcome for Black residents of Tacoma and provide budget and policy recommendations that leverage the results to increase Black homeownership in the City. The Disparity Study was completed in 2021 resulting in the report below. Next steps are currently in development.
2021 Tacoma Housing Disparities Report
For inquiries regarding existing Tacoma down payment assistance loans including:
- Loan Payoff Requests
- Loan Subordination Needed for Refinancing Purposes
- Completing a subordination request form
You may contact the Financial Assistant at (253) 281-7356 or via email.
Contact
Applications are being accepted through December 2025 or until all funding has been committed.