Direct Home Loan Program



VHFA's Direct Home Loan Program is only available for single and double-wide mobile homes that are currently financed with VHFA. Please check with the seller of the property about the source of their current financing. Occasionally, financing for specific condominium projects is offered through this program at different rates and terms. For a list of projects, See Eligible condominium projects.

Only VHFA borrowers are exempt from the Vermont Property Transfer Tax on the first $110,000 of the purchase price; which can save you up to $625.00.

Program details

  • Up to a 30-year loan term (based on the property)
  • Minimum credit score of 620
  • For mobile homes: Up to 95% maximum loan amount (5% minimum down payment).
  • For eligible condominiums: 80% maximum loan amount/20% down payment. See a list of eligible condominium projects and contact VFHA for rate and terms.
  • A second mortgage from an eligible non-profit or lender is permitted (for double-wide units and condos only)
  • 3% minimum cash contribution must come from borrowers' own saved funds
  • 2 months reserves from borrower's own saved funds must be available after closing
  • Pre-purchase education from a NeighborWorks® HomeOwnership Center must be completed by all borrowers
  • Seller may provide up to 3% of the purchase price for down payment and/or closing costs
  • Eligible Property: 1976 or newer single and double-wide mobile homes that are permanently affixed to land and currently financed with VHFA, and eligible condominium projects
  • Mortgage insurance is required on all loans with less than a 20% down payment

Eligibility requirements*

  • If purchasing in Addison, Bennington, Chittenden, Grand Isle or Windsor counties, all borrowers must not have had an ownership interest in a principal residence in the past three years. This requirement does not apply to veterans who've served within the last 25 years or in Burlington's Census Tract 4.
  • The income of all borrowers (and spouse) must be within the VHFA Income Limit in effect at the time of application
  • All borrowers must take occupancy of the property within 60 days after closing and continue to occupy for the life of the loan
  • The purchase price of the property must be within the VHFA Purchase Price Limit in effect at the time of application and not include more than 15 acres. 2-unit properties must have been occupied as a residence for the previous five (5) years.
  • All borrowers must not have an ownership interest in other real estate at the time of purchase, with limited exceptions. If you own other property, your lender will determine your eligibility.

*A non-borrowing spouse must also meet all eligibility requirements

Interest rates

7.500%

(7.710% APR)
Fixed rate with 2 discount point(s)

discount points might be tax-deductible. click to learn more.

You might be able to deduct discounts points from your taxes in the year you pay them — or over the life of your loan — if you meet certain conditions outlined by the IRS.

VHFA doesn't provide tax advice. Contact your tax-preparer or visit the IRS for details.

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4 simple steps to a vhfa mortgage. click to learn more.

VHFA doesn't pre-qualify borrowers or take applications. Here's how the application process works:

  1. Review the list of VHFA Participating Lenders to find a lender in your area.
  2. Contact the lender of your choice. We provide contact information for each participating lender.
  3. Review VHFA's program requirements with your lender to determine your eligibility.
  4. Complete the loan application with your lender, providing all required documentation.

Your lender will take care of nearly everything:

  • Processing your application
  • Requesting a property appraisal
  • Obtaining all needed approvals
  • Working with your closing agent to close your loan
  • Submitting all required documents to VHFA and other parties, as applicable

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Payment calculator

Federal Recapture Tax

Federal Recapture is a requirement of VHFA's source of funds. Only borrowers that meet specific criteria are subject to the tax.

However, VHFA will reimburse borrowers that close their VHFA home loan after February 1, 2006 for any tax they are required to pay.

The tax only applies if you sell your home in the first nine years, you realize a net gain on the sale and your income in the year you sell exceeds a limit that increases each year. Your lender will provide you with further details.