Down Payment Assistance Programs
A down payment can be one of the biggest challenges when buying a home. Down payment assistance programs may help eligible buyers cover a portion of their down payment or closing costs, making homeownership more accessible. Understanding how these programs work can help you explore your options with greater confidence.
DIFFERENT PROGRAMS.ONE SHARED GOAL.
Support Designed for Different Needs.
Down payment assistance may be offered as a grant, forgivable loan, deferred payment loan, or other form of financial support. Some programs can also help with eligible closing costs. Program availability, repayment terms, and requirements vary by location and provider.
Different Formsof Support.
Down payment assistance is not one size fits all. Here are several common ways eligible homebuyers may receive support.
| PROGRAM TYPE | HOW IT MAY WORK | WHAT TO CONSIDER |
|---|---|---|
| Grants | Funds may be applied toward an eligible down payment or closing costs. | Often does not require repayment, but eligibility and occupancy rules may apply. |
| Forgivable Loans | Assistance is provided through a second loan that may be forgiven over time. | Selling, refinancing, or moving too soon may require repayment. |
| Deferred Payment Loans | Monthly payments may not be required while you occupy the home. | The balance is generally due when you sell, refinance, or repay the first mortgage. |
| Second Mortgages | Assistance is provided as a separate loan alongside the primary mortgage. | Monthly payments, interest rates, and repayment terms vary by program. |
| Closing Cost Assistance | Funds may help cover eligible settlement expenses and prepaid costs. | Covered expenses and maximum assistance amounts depend on the program. |
| Matched Savings | A program may match part of the buyer’s eligible savings toward a home purchase. | Participation may require advance enrollment, savings goals, and homebuyer education. |
| Lender Assistance | A lender may provide a credit or assistance option toward eligible upfront costs. | Pricing, loan terms, and qualification requirements should be reviewed carefully. |
Who MayQualify?
Eligibility varies by program. Requirements may consider household income, credit qualifications, purchase price, property location, occupancy, and whether the buyer completes an approved homebuyer education course.
Buyer Requirements
- You meet the program’s household income limits
- You qualify for an eligible first mortgage
- You intend to occupy the home as your primary residence
- You can provide any required minimum buyer contribution
- You complete homebuyer education when required
- You meet the applicable credit and debt requirements
- First time and repeat buyers may qualify depending on the program
Property and Program Requirements
- The home is located within an eligible area
- The purchase price falls within program limits
- The property type meets program guidelines
- The home will be used as your primary residence
- Program funds are available when the assistance is reserved
- The first mortgage and lender meet program requirements
- Occupancy, resale, or refinancing restrictions may apply
Understandthe Details.
Assistance can reduce the amount of money needed upfront, but every program has its own terms. Review whether the assistance must be repaid, how long you must occupy the home, and what happens if you sell or refinance. Income limits, purchase price limits, available funding, approved loan products, and education requirements may also affect eligibility.
A Stronger Startto Homeownership.
Down payment assistance can help eligible homebuyers manage upfront costs, but choosing the right program requires looking at the complete financing picture. A knowledgeable loan officer can review available programs, first mortgage terms, repayment requirements, and your long term goals to help identify options for which you may qualify.
Keep Learning.
Explore more guides and resources designed to help you make informed decisions throughout your homebuying journey.
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