What down-payment assistance and first-time-homebuyer programs exist, and how do they work?
Plenty. State housing agencies, counties and cities, nonprofits and some lenders run down payment assistance, often covering around 3% to 5% of the price. It comes as a forgivable loan, a repayable second mortgage or a grant. Most programs have rules: a minimum credit score, an income limit, and either repayment or a requirement to live in the home for a set time.
Last updated September 29, 2026Where does the assistance come from?
There's no single national program. It's a patchwork of state and local options run by state housing finance agencies, local governments, nonprofits and some lenders; an industry count found 2,679 programs nationwide in early 2026. Because the source differs by place, the amounts and rules differ from state to state and even county to county.
Do I have to pay it back?
It depends on how the program is set up:
It depends on your situation:
- A forgivable loan: you generally don't repay it if you live in the home as your primary residence for a required period, often anywhere from 3 to 15 years depending on the program and the amount. Sell or refinance before then, and some or all of it can come due.
- A repayable second loan: it's a real second mortgage. Some are deferred, with no payment until you sell, refinance or pay off the first mortgage. Others have their own monthly payment.
- A grant with no lien: there's nothing to repay, because no loan is recorded against the home.
What does it take to qualify, and what's the trade-off?
Most programs set a minimum credit score, commonly in the 620 to 660-plus range, and a household income limit tied to the area's median income. Many pair the assistance with their own first mortgage at a set rate, so compare the whole package, rate plus assistance, with a standard loan before you decide. Get the program's terms in writing: how much you'll receive, whether it's repaid and how long you need to stay.
| Assistance amount | Around 3% to 5% of the price |
|---|---|
| Minimum credit score | Commonly 620 to 660-plus |
| Time to stay, if forgivable | Commonly 3 to 15 years |
| Income limits | Yes, tied to the area's median income |
| First-mortgage rate | Often set by the program |
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Sources
- https://downpaymentresource.com/professional-resource/down-payment-assistance-continues-to-expand-in-q1-2026-reaching-2679-programs-nationwide
- https://www.bankofamerica.com/mortgage/affordable-housing-programs
- https://welcomehome.tdhca.texas.gov/programs
- https://cdola.colorado.gov/down-payment-assistance
- https://www.cookcountyil.gov/news/cook-county-launch-third-phase-down-payment-assistance-program
- https://www.reachhomeloans.com/down-payment-assistance-programs-in-florida
- https://ohiohome.org/partners/documents/AtAGlance.pdf
- https://www.buildbuyrefi.com/down-payment-assistance
- https://downpaymentresource.com/homebuyer-resource/payment-assistance-program-features-explained-2
- https://www.chfa.org/homebuyers-homeowners/homebuyers/time-to-own-down-payment-assistance-program-loan
- https://www.tsahc.org/home-buyer-programs
- https://www.ohfa.org/eligibility-tool
- https://housing.az.gov/sites/default/files/Pathway_to_Purchase_Flier_v3.15.2016N.pdf
- https://housing.lacity.gov/housing/help-moderate-income-first-home-buyers
- https://www.investopedia.com/terms/s/silent_second_mortgage.asp
Sourced from licensed loan officers and brokers in the FreeRateUpdate network.
Educational information only, not individualized financial or legal advice. Program details and rates change; verify current terms with a licensed loan officer before making a decision.