The funds are provided in the form of a forgivable loan. As long as borrowers comply with the terms and conditions of the program, their loan balance will be forgiven at 20% or $2,000 each year for five years. Borrowers will receive a 1099-form annually from the county for the forgiven amount as it is considered taxable income.
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Your clients are eligible to apply for the Public Employee Homeownership Grant (PEG) Program if they meet all of the following qualifiers:
The loan is secured by a second lien on the home for a 5-year term at 0.00%. The maximum loan amount is $10,000. As long as the borrower maintains employment with the county or Loudoun County Public Schools (LCPS), keep the home as their primary residence and do not sell their home for a period of 5 years, the entire loan balance will be forgiven.
It is in the best interest of both the borrower(s) and the county to avoid causing undue financial burden for the homeowner as a result of the acceptance of the loan in the case that repayment should be required. Therefore, the county will consider the borrower’s existing debt along with the new mortgage payment by reviewing debt-to-income (DTI) ratios at the time of application.
Yes - many ADU buyers take advantage of one of the county’s housing finance programs.
No - even if borrowers are eligible for both homeownership programs, only one may be used.