The American Dream Downpayment Initiative

The American Dream Downpayment Initiative was created in 2003 to aid low-income, first-time homebuyers in achieving affordable housing by eliminating two of the biggest hurdles in buying a home: a downpayment and closing costs. The goals of the ADDI include increasing the country's homeownership rate, creating more opportunity for homeownership among lower-income and minority families and stabilizing communities in every state. Along with first-time homeowners, ADDI also provides financial assistance to homeowners who require home rehabilitation due to hazardous or unhealthy conditions.

Am I eligible?

To be eligible for a no downpayment home loan through ADDI, you must:

• Be a first-time homebuyer seeking a single family home
• Not have income exceeding 80% of the area's median income
• Have home rehabilitation completed within 1 year of the home purchase, if applying for rehabilitation assistance

How does it work?

Funded by HUD, the American Dream Downpayment Assistance Act authorizes up to $200 million annually for ADDI. Certain local lenders are partnered with ADDI so that they can offer home loans to families at no downpayment.

What are the alternatives?

If you're a low-income, first-time homebuyer and you qualify according to the above requirements, ADDI may be the right home loan for you. However, if you don't qualify for the government-funded ADDI there may local, nonprofit organizations which can help you to purchase a home without a downpayment. Some of these organizations do not have an income limit or limit their services to first-time homebuyers. Visit the following links for organizations that may be a better fit for you.

Get Downpayment

Home Downpayment Grants

EZ Down Payment

Do I really need this type of loan?

If you are a low-income potential homebuyer, an ADDI loan may enable you to achieve homeownership more quickly, or possibly at all. However, if you are not a first-time homebuyer or can afford a down payment, it may be in your best interest to investigate other mortgage options through your local lender.