How to Navigate the Soft Second Mortgage Program in New Orleans

The Soft Second Mortgage Program in New Orleans is designed to provide a supplemental home “loan” that bridges the gap between what you can afford and what you want to buy. It is an income-based program that requires you to be a first time home buyer and attend twelve hours of home buyer training. As long as you live in the house for ten years, the Soft Second loan is forgiven. It is an excellent way to stimulate the housing market in New Orleans and provide better choices for low to medium income residents of the city.

The first step to home ownership through this program is to contact an Approved Home-Buyer Training Organization. There are twelve organizations to choose from and a few cater to Spanish speaking residents. The complete list can be found on the City of New Orleans’ government website (search for “Soft Second”). When you contact one of these organizations, they will set up an appointment for you to meet with a home buyer counselor. They will ask for your last three pay stubs, W-2s and tax forms, and for you to pay for a credit check. The counselor will most likely discuss your budget, savings, and all your other financial business to determine if you are “mortgage ready”. If not, they will help you budget and teach you how to improve your credit score. If your finances are in good condition and if you meet the qualifications for the program, you will be scheduled for two home-buyer training classes that are six hours long each.

The Home-Buyer Training Course is packed full of valuable information. Experts from every avenue of home-ownership give a presentation about their area of knowledge. You will hear presentations from an insurance agent, a lender, a real estate agent, a contractor, an assessor, and a representative from the Greater New Orleans Fair Housing Action Center. They provide you with literature, contact information, and offer you the opportunity to ask questions. They empower you by providing you with honest information that will prevent professionals in their respective fields from taking advantage of your inexperience.

Following the Home-Buyer Training Course, you will need to find a real-estate agent who is familiar with the Soft Second Mortgage Program and Procedure. Ask for recommendations from people you know and research online to find an honest and helpful agent. Ask questions about the Soft Second Program when you first speak to them to ensure they know enough to assist you with the process. You will need to follow the same advice when you look for a lender. Feel free to shop around for a good real-estate agent and an honest lender. Don’t let anyone pressure you or make you feel obligated to buy a certain home or work with a certain individual.

You will be required to put down at least $1500 towards the down payment when you make an offer on a house. Your lender will pre-qualify you for a loan after looking over all of your finances and determine how much Soft Second money and closing cost assistance you will be able to receive. At this point, you may already have a house in mind and will only need to follow-through with the offer and closing details. A good real-estate agent will prepare you for the process and walk you through it.

The Soft Second Mortgage Program is an excellent resource for first time home-buyers with little to no savings. It also benefits the City of New Orleans by bringing home-owners to distressed areas and allowing investors to renovate and sell damaged homes. Become a part of the re-growth of the city and invest in your future for your family with the Soft Second Mortgage Program.