Keystone Government Loan Program - PHFA
The PHFA Keystone Government Loan Program is different from the Keystone Home Loan Program because this program is not limited to Pennsylvania first-time home buyers.
The Keystone Government Loan Program (also called K-Gov) is based on FHA, VA (Veteran) or USDA financing; and unlike the Keystone Home Loan program, there are:
- No sales price limitations
- No income limitations
- No first-time home buyer requirements
Eligible home buyers can use theKeystone Advantage Assistance Loan Program with the Keystone Government Loan Program. The assistance program is a 2nd mortgage up to $6,000 for down payment or closing cost assistance.
Non-occupying co-borrowers (i.e. co-signers) are permitted with the Keystone Government Loan (FHA) provided the co-borrower and applicant meet the PHFA underwriting guidelines (rules).
| LOAN PROGRAM | The good news | The bad news |
|---|---|---|
| FHA Home Loan (Federal Housing Administration)  | The FHA loan is a government backed home loan program that offers a low down payment of 3.5%, no first-time home buyer requirement, and the seller is permitted (not required) to pay up to 6% of the sales price toward closing, escrow and prepaid costs. | There are maximum mortgage amounts with a FHA mortgage. |
Veteran Loan (VA) | VA home loans do not require a down payment requirement - "0". | All vets must pay a funding fee (except disabled vets). |
| USDA Loan (United States Department of Agriculture)  | The USDA home loan is another government backed home loan program. The USDA mortgage is a zero down mortgage. Monthly mortgage insurance premium (PMI) is required. | The home must be located in a USDA defined "rural" area. |
