There is no monthly payment on the 3.5% forgivable second. Stay in the home as your primary residence through the full 3- or 5-year forgiveness term and that balance can be forgiven. Exit early — sale, refinance, or first-mortgage payoff — and the remaining unforgiven balance becomes due.
The 3.5% forgivable PATH second is not a traditional amortizing loan you chip away at every month. There is no monthly principal-and-interest payment on the assistance layer.
Forgiveness is earned by satisfying the second-lien term — either the 3-year or 5-year forgivable option — while the home remains your primary residence.
Complete the full forgiveness period under those occupancy rules and the assistance balance can be forgiven with no monthly payment along the way.
Forgivable does not mean free if you exit before the clock finishes.
If you sell the home before the 3- or 5-year forgiveness period is complete, the remaining unforgiven balance on the assistance layer becomes due and payable at that event.
Paying off the first mortgage early — including through refinance or full payoff — before the forgiveness term ends also triggers the remaining unforgiven assistance balance.
If you expect to sell or refinance within a few years, Ryan and Steve will weigh whether a shorter 3-year forgivable term, a 5-year term, or a repayable second is the better economic choice for your file.
| Question | 3.5% forgivable | Repayable second |
|---|---|---|
| Monthly payment? | No | Yes — P&I on the second |
| How is it repaid? | Forgiven after term if rules met; early exit = remaining balance due | Scheduled payments over 10 years (amortizing or balloon) |
| Max assistance | 3.5% | Up to 5% |
Related Luminate Path guides on assistance structure and eligibility.
Program overview — forgivable and repayable second-lien options.
3.5% forgivable amounts by property value.
When repayable may fit better than forgivable.
640 minimum for forgivable PATH assistance.
Full guide — early-exit rules and product details.
Compare PATH forgiveness with other DPA programs.
PATH FHA first mortgage paired with forgivable DPA.
Ryan & Steve will align the forgiveness clock with how long you expect to stay — and flag when repayable PATH is the stronger fit.
Luminate Path programs are subject to borrower qualification, property eligibility, and lender approval. Rates, terms, and program availability may change without notice and are not available in all states. This page is educational — your scenario is underwritten against current guidelines.