This story is part of CT Mirror Explains, an ongoing effort to distill our wide-ranging reporting into a "what you need to know" format and provide practical information to our readers.
Editor’s Note: This article is part of CT Mirror’s Spanish-language news coverage developed in partnership with Identidad Latina Multimedia.
Connecticut’s Time to Own program, which is designed to encourage homeownership, offers forgivable loans to qualifying first-time homebuyers in the state.
The program, which has opened and closed multiple times since it launched in June 2022, has helped over 4,800 people buy their first homes — more than half of whom are people of color, Gov. Ned Lamont’s office said in a press release.
Applications reopened in October after the State Bond Commission approved $40 million in bonding for it, and as of Nov. 18, just under $29 million was still available to homebuyers.
“Owning a home is a cornerstone of the American Dream, and programs like Time to Own are making it possible for more Connecticut residents to turn that dream into reality,” Lamont said in a statement upon the program’s reopening.
Here’s what to know about eligibility for Time to Own and how to apply for it.
What does Time to Own offer?
Beneficiaries can receive financing to cover up to 20% of their down payment and up to 5% of their closing costs. The minimum loan amount is $3,000 and the maximum is $25,000.
The loan has a 0% interest rate and doesn’t require a monthly payment. It’s forgivable, with 10% forgiven each year until it is fully forgiven after 10 years.
Time to Own is administered alongside a Connecticut Housing Finance Authority, or CHFA, first mortgage loan, which is a loan taken out at a participating lender, of which there are dozens throughout the state.
Who is eligible?
Applicants must be first-time homebuyers who have lived in Connecticut for the past three years. They must meet certain income limits, credit score requirements and debt-to-income ratios, and the home they’re purchasing needs to be used as a primary residence and must meet a sales price limit.
Residents who earn up to 80% of their area median income can receive up to 100% of their qualifying loan amount, while buyers making 81% to 100% of their AMI are eligible for up to 75% of what their loan amount would be. Area median income limits can be found here.
Buyers who are purchasing a home in a “target area” — which are designated by the federal Department of Housing and Urban Development — can be eligible for the program even if they are not a first-time homebuyer, though they cannot own property at the time of closing.
“HUD every year gives us a list of the census tracts that are deemed eligible as a target area,” said Marcus Smith, director of research, marketing and outreach at CHFA. “Generally they are somewhat disinvested, they might have lower homeownership rates.”
What is required of participants?
CHFA requires that participants take classes on homeownership.
Homebuyers can take either a pre-purchase workshop — covering pre-approval for a mortgage, making an offer and the closing process — or a pre-closing workshop, which covers the closing process and topics like budget planning, home maintenance and foreclosure prevention.
Classes are available in-person and virtually, and one-on-one counseling is an option as well.
“Studies have shown that, especially for first-time homebuyers — and especially first-time homebuyers of, say, moderate income or lower income — going through housing counseling dramatically reduces the likelihood that they’ll run into a hardship with the mortgage in the future,” Smith said.
How do I apply for the program?
Call or visit a participating lender, a list of which can be found on CHFA’s website.
