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VHDA Closing Cost Assistance (CCA) Grant

To: VHDA Originating Lenders
Re: Announcing the ‘New’ VHDA Closing Cost Assistance (CCA) Grant Program

Introducing the new VHDA Closing Cost Assistance (CCA) Grant for VHDA Rural Housing Services (RHS) and Veterans Affairs (VA) Loans

In an effort to support first-time buyers in Virginia’s rural markets and provide assistance to eligible current and former members of the U.S. military, VHDA is pleased to announce the Closing Cost Assistance (CCA) Grant program. These grant funds will be used to reduce the borrower’s out-of-pocket expenses, making these 100% financing programs even more affordable.

Grants will be limited to 2% of the lesser of the purchase price or appraised value. VHDA Lower Grant Income Limits apply (the same as our Down Payment Assistance Grant income limits), and income for all household members, regardless of whether they are a borrower or non-borrower on title, must be included.

Eligible Programs
Closing cost assistance grant funds will be made available to borrowers obtaining a VHDA Rural Housing Services (RHS) or Veterans Affairs (VA) first mortgage loan, and may be used for closing costs only, which includes payment of the RHS Guaranty fee or VA Funding fee.

Note: The following first mortgage loan programs are not eligible for the CCA grant: Fannie Mae No MI, Fannie Mae Reduced MI, and FHA. In addition, these grant funds may not be used in conjunction with the VHDA Down Payment Assistance Grant or the VHDA Plus Second Mortgage program.

Reservation and Funding Process
Reservations for the CCA Grant will be available beginning Wednesday, November 14, 2018. The VHDA first mortgage must be locked prior to reserving the grant. Grant reservations will be available for new and existing eligible loans.

To reserve grant funds, the Originating Lender will follow the steps outlined in the Mortgage Cadence User Guides available on VHDA’s website. A Confirmation/Award letter will be generated in Mortgage Cadence and available in “Attachments.” After reservation of CCA grant funds, if the lender determines that the borrower(s) is no longer eligible for a VHDA first mortgage, or does not meet the income restriction for the CCA grant, the lender will be responsible for cancelling the reservation immediately.

The Originating Lender will fund the CCA grant at time of closing. VHDA will reimburse the lender upon purchase of the first mortgage.

Post-Closing Documentation

The CCA Grant Confirmation/Award letter signed by the borrower(s) must be included in the VHDA closing package for purchase. The Closing Disclosure (CD) must reflect the VHDA CCA grant.

Note: No Note or Deed of Trust should be executed for these funds. A complete list of program specific guidelines are available on the web at

Please contact your assigned VHDA Business Development Officer or if you have any questions.