Oregon housing and Community Services (OHCS) offers many programs for first-time home buyers, renters, homeowners, homeless, and developers. As a result of statewide funding and action between July 2019 and July 2024:
– 1,668 permanent supportive housing units were created
– 28,389 affordable rental homes are built or are in the pipeline
– 3,368 households became homeowners (with OHCS assistance through the DPA program)
– 248% increase in OHCS funded Rural Housing Development or 5,058 units
The main program the state of Oregon offers to homebuyers is the Oregon Flex Program. This is an update from their previous bond program that sunsets on March 31, 2025. This program allows you to put as little as 0% down when purchasing a primary home (that you will occupy) and is provided for buyers who make less than $125,000. If you are a first-time homebuyer, you will receive a discount on your interest rate. If you make less than 80% of the Area Median Income (AMI) the Down Payment Assistance (DPA) Loan will be ‘Silent’ meaning it has no payment. AMI chart can be found below.
The way the Oregon Flex DPA program works is that you get a normal conventional loan, or a government loan (FHA, VA, USDA) as your first mortgage, and OHCS provides the 2nd Mortgage.This Second mortgage will be either 4% or 5% of the total loan amount and it can go towards your down payment. That means that if you negotiate seller paid closing costs you can theoretically come to closing with 0$ out of pocket. Example: $300,000 purchase price, 3% conventional loan $11,000 closing costs. Down payment $9,000, and OHCS provided DPA second $14,850 (5% of loan amount). This covers all of the down payment and a portion of the closing costs. The remaining closing costs could be negotiated in the purchase agreement with the seller. Only lenders and brokers that have an approved relationship with OCHS can originate these loans. If you would like to inquire about details I can help as an approved provider.
With the Flex program there are two options: FirstHome and NextStep. To qualify for FirstHome it must be your first home purchase (defined as not having owned a home in the previous 3 years verified with 3 years of tax returns), or you must be a veteran, or you must be purchasing in a ‘targeted area’ census track. This is defined as a Census tract in which 70% or more of the families have income that is at or below 80% of the statewide median family income. The main advantage of the FirstHome product is that it provides a more favorable interest rate. The NextStep program is for folks that have owned a home in the previous 3 years or need a cosigner to qualify as the FirstHome program does not allow a non-occupant co-borrower
Oregon Flex Rates can adjust daily and are posted on their website. The FirstHome rate is typically 0.375% under the NextStep rate and generally under current market rates. There are different rates for government and conventional loans, (government being lower) and the second lien rate is 1% higher than the first lien rate if you make more than 80% of the AMI. The nice thing about the OHCS Flex rates is that they are not subject to Loan Level Price Adjustments (LLPA’s) or premium pricing. This means that whether you have a 620 FICO score, or a 780 FICO score you rate will be the same. It also means that you cannot pay additional costs to get a lower rate or take a higher rate and pay fewer closing costs.
DPA 2nd Lien – the 2nd lien comes as 4% or 5% of the loan amount. 5% is available if you meet 2 of 4 criteria:
– Household of 4 or more
– Household member with a disability
– Front-end debt ratio of 28% or higher (this is most always met with the price of housing in Oregon combined with the $125,000 income limit on this program)
– Sole head of household with one or more dependent under 18 or over 62
If you earn less than 80% of the AMI (see chart below) the second lien is ‘silent’ meaning no payment is required. If you make more than 80% of the AMI the second lien rate is 1% over the 1st lien. If you make between 80% and 120% of AMI the 4% loan is amortized over 20yrs with an interest rate and the 5% is amortized over 30 years. If you make over 120% of the AMI the second lien is 4% of the loan amount and amortized over 10 years. In all cases the 2nd lien is repayable at sale or refinance.
For more specific questions about guidelines or structuring or to get a quote please reach out: Contact Jordan – Educated Mortgage Advice
AMI tiers/Income limits
| County | =/< 80% AMI | > 80% – 120% AMI | >120% AMI Capped at $125K |
|---|---|---|---|
| Baker | $64,720 | $97,080 | $125,000 |
| Benton | $87,840 | $125,000 | N/A |
| Clackamas | $93,520 | $125,000 | N/A |
| Clatsop | $73,840 | $110,760 | $125,000 |
| Columbia | $93,520 | $125,000 | N/A |
| Coos | $64,720 | $97,080 | $125,000 |
| Crook | $72,800 | $109,200 | $125,000 |
| Curry | $64,720 | $97,080 | $125,000 |
| Deschutes | $84,080 | $125,000 | N/A |
| Douglas | $64,720 | $97,080 | $125,000 |
| Gilliam | $64,720 | $97,080 | $125,000 |
| Grant | $64,720 | $97,080 | $125,000 |
| Harney | $64,720 | $97,080 | $125,000 |
| Hood River | $83,360 | $125,000 | N/A |
| Jackson | $70,240 | $105,360 | $125,000 |
| Jefferson | $64,800 | $97,200 | $125,000 |
| Josephine | $60,800 | $91,200 | $125,000 |
| Klamath | $64,720 | $97,080 | $125,000 |
| Lake | $64,720 | $97,080 | $125,000 |
| Lane | $71,280 | $106,920 | $125,000 |
| Lincoln | $64,720 | $97,080 | $125,000 |
| Linn | $67,920 | $101,880 | $125,000 |
| Malheur | $64,720 | $97,080 | $125,000 |
| Marion | $73,040 | $109,560 | $125,000 |
| Morrow | $64,720 | $97,080 | $125,000 |
| Multnomah | $93,520 | $125,000 | N/A |
| Polk | $73,040 | $109,560 | $125,000 |
| Sherman | $64,720 | $97,080 | $125,000 |
| Tillamook | $64,720 | $97,080 | $125,000 |
| Umatilla | $77,680 | $116,520 | $125,000 |
| Union | $64,720 | $97,080 | $125,000 |
| Wallowa | $64,720 | $97,080 | $125,000 |
| Wasco | $66,640 | $99,960 | $125,000 |
| Washington | $93,520 | $125,000 | N/A |
| Wheeler | $64,720 | $97,080 | $125,000 |
| Yamhill | $93,520 | $125,000 | N/A |