LHC Soft Second Program Louisiana: How to Get Up to $60,000 in Assistance

The Louisiana Housing Corporation runs some of the most aggressive first-time homebuyer assistance programs in the country. Buyers who qualify for the flagship Soft Second programs can access up to $60,000 in forgivable down payment and closing cost assistance — money that either disappears after ten years of staying in your home or gets repaid when you sell or refinance.

The catch: the programs have specific eligibility restrictions that eliminate large swaths of the Louisiana market, particularly in flood-prone areas. Understanding exactly what qualifies before you start shopping for homes is the difference between finding a deal and having a transaction collapse.

The Resilience Soft Second Program

The Resilience Soft Second is the LHC's primary assistance vehicle for buyers in the 51 parishes designated for hurricane and flood disaster recovery (covering Gustav/Ike and Isaac designations). This includes most of coastal and central Louisiana.

What it provides:

• Up to $55,000 in a deferred, 0% interest second mortgage for the down payment gap
• Up to $5,000 as a direct grant for closing costs (title fees, insurance, pre-paids)
• Total maximum assistance: $60,000

How the forgiveness works:

The second mortgage is deferred — no monthly payments, no interest accruing. If you remain in the home as your primary residence for the full ten years, the entire balance is completely forgiven. If you sell, transfer, or refinance before ten years, you repay the outstanding balance at that time.

Eligibility requirements:

• First-time buyer: No ownership interest in a principal residence during the three years before purchase (specific exceptions for single parents and displaced homemakers)
• Income: Household income at or below 80% of Area Median Income (AMI) for your metropolitan statistical area
• Flood zone: The property cannot be located in a flood zone — only Zone X and Zone X Protected by Levee qualify
• Parish: Must be in one of the 51 designated disaster recovery parishes
• Homebuyer education: Required — must complete a HUD-approved homeownership education course before closing

The flood zone restriction is the most common disqualifier. Buyers in urban markets who fall in love with a property in Zone AE, AO, or any SFHA designation are automatically ineligible for Resilience funding. This restriction exists because the LHC lists itself as a second lienholder on the property, and properties in flood zones represent unacceptable risk to the program.

The Pathways to Homeownership Initiative

For buyers in select geographic areas outside the Resilience program's reach, the Pathways to Homeownership Initiative provides up to $6,000 in direct assistance for down payment and closing costs. Any soft second loan component under Pathways is also forgiven after ten years of continuous primary occupancy.

This program has narrower geographic targeting and lower maximum assistance than Resilience, but it extends the reach of LHC assistance into areas not covered by the disaster recovery designations.

MRB Home and MRB Assisted Programs

The Mortgage Revenue Bond (MRB) programs take a different approach — rather than offering a large lump-sum soft second, they pair a below-market interest rate first mortgage with a percentage-based grant or soft second:

MRB Home:

• 4% to 9% of the loan amount in down payment and closing cost assistance (the percentage scales inversely with loan size — smaller loans receive higher percentages)
• Minimum credit score: 640
• Income: ≤80% AMI (expands to 140% in Targeted Area/Qualified Census Tract properties)
• In Targeted Areas, the first-time buyer requirement may be waived entirely

MRB Assisted:

• Fixed 4% of the loan amount in assistance
• Slightly relaxed eligibility compared to MRB Home
• Below-market first mortgage rate bundled with the assistance

These programs work well for buyers with stable income who may not qualify for the large soft second because they're slightly over the 80% AMI threshold in standard areas, or who are purchasing in Targeted Areas where the expanded income limits apply. The MRB assistance is structured as a true grant in some configurations — no repayment required.

Keys for Service Program

The Keys for Service Program targets specific essential civic workers who often earn moderate incomes but serve critical public roles. Eligible professions:

• Full-time law enforcement officers (state, parish, or city)
• Firefighters
• Licensed paramedics
• Certified public school teachers (public or private school boards)

What it provides:

• 4% of the final loan amount for down payment and closing costs, capped at $10,000
• Available to both first-time and repeat buyers (you simply cannot own other residential property at closing)
• Household income limit: ≤$125,000

Forgiveness terms: The assistance is structured as a forgivable loan. If you sell or pay off the loan within five years, you must reimburse the assistance amount. After five years of continuous occupancy, it's forgiven.

For a teacher or police officer buying a $200,000 home with a $193,000 FHA loan (after a 3.5% down payment of approximately $7,000), the Keys for Service Program provides $7,720 — covering the down payment with room left for closing costs. For buyers in this category, it's one of the most efficient assistance programs in the portfolio.

Baton Rouge: CAFA and City Programs

Beyond the state programs, East Baton Rouge Parish buyers have access to additional assistance layers:

Capital Area Finance Authority (CAFA): Provides a non-repayable grant up to 5% of the final loan amount for down payment, closing costs, or buying out mortgage insurance. This is a true grant — no repayment requirement. CAFA grants can often be stacked with LHC MRB programs.

City of Baton Rouge Office of Community Development: Has partnered with specific affordable housing developments (such as Copper Oaks) to offer targeted homebuyer incentives up to $50,000 contingent on funding availability. These are project-specific and require coordination with the development.

Baton Rouge buyers who survived the 2016 floods are often skeptical of the long-term cost trajectory — insurance and flood risk reviews have caused permanent reassessments of affordability in Livingston and portions of East Baton Rouge. The assistance programs help, but buyers should still conduct full total carrying cost analysis (mortgage + flood insurance + wind/hail + property tax) before committing.

New Orleans: City Direct Homebuyer Assistance

The City of New Orleans Direct Homebuyer Assistance Program (administered by the Office of Community Development using CDBG funds) provides:

• Up to $55,000 in Soft Second Mortgage Assistance
• Up to $5,000 for closing costs (limited to 50% of total closing costs)
• 0% interest, graded forgiveness starting at year five

Key Orleans Parish distinctions:

Unlike the LHC state programs, the New Orleans program does permit purchases in flood zones, provided the buyer maintains flood insurance. This is a critical difference for urban buyers who struggle to find Zone X inventory in New Orleans.

Maximum sales price: $324,000 Buyer contribution: At least $1,500 or 1% of purchase price from personal funds DTI limit: Back-end ratio capped at 48%

Forgiveness schedule:

• Sold or moved before year 5: Full repayment required
• After year 5: 25% forgiven
• Each subsequent year: 15% additional forgiveness
• Year 10: Fully forgiven

How to Use These Programs

The strategic path is to contact an LHC-approved lender — not just any bank — to walk through your specific income, parish, profession, and target flood zone. LHC-approved lenders know which programs are active and can confirm current funding availability (some programs deplete their allocations and pause mid-year).

Most buyers access these programs through a single contact point: an LHC-approved mortgage lender who handles both the first mortgage and the assistance program origination simultaneously. The lender coordinates with the LHC or local authority, orders the required homebuyer education course certification, and structures the closing to properly record both the first mortgage and the soft second lien.

The Louisiana First-Time Home Buyer Guide at /us/louisiana/first-home/ includes program comparison tables, income limit charts by parish and household size, and a stacking worksheet that maps which programs can be layered together — including LHC programs with CAFA, Lagniappe Advantage, and Mortgage Credit Certificates.

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