Down Payment Assistance Programs: What's Available and How to Apply
The short answer
- Down payment assistance comes from states, counties, cities, and nonprofits — many buyers never check
- Grants, forgivable, deferred, and shared-appreciation loans each have different repayment terms
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Why this matters
Down payment assistance is offered by states, counties, cities, and nonprofits across the country. Many first-time buyers never look into it because they do not know these programs exist.
Types of Assistance
Grants: money that does not need to be repaid, though some carry conditions such as staying in the home for a set time. Forgivable loans: forgiven after you live in the home for a set period. Deferred loans: no payments until you sell, refinance, or pay off the first mortgage. Shared-appreciation loans: you repay the amount plus a share of any increase in value. Low-interest second mortgages: a second loan at a reduced rate. Read the repayment terms before you sign.
Who Programs Are For
Most programs target first-time buyers, which often means anyone who has not owned a home in the past 3 years. Income limits, set as a percentage of area median income, are common, and many programs also cap the price, require the home to be your primary residence, and require a homebuyer education course. Some target professions such as teachers or first responders. City, county, and state programs each have their own rules.
How to Find Programs
Start with your state housing finance agency. In California, that is CalHFA (California Housing Finance Agency): its MyHome Assistance Program is a deferred-payment second loan used with a CalHFA first mortgage, its Zero Interest Program can help with closing costs, and its Dream For All program offers shared-appreciation help of up to 20% of the price, capped at $150,000, for first-generation buyers, awarded by drawing in limited rounds. CalHFA programs go through approved lenders. Many California cities and counties have their own programs. Ask your lender which programs they use, check HUD's list of local programs, and apply early, since funding is limited.
Everything to remember
- Down payment assistance comes from states, counties, cities, and nonprofits — many buyers never check
- Grants, forgivable, deferred, and shared-appreciation loans each have different repayment terms
- Most programs set income and price limits and require a homebuyer education course
- In California, start with CalHFA and your city or county, and ask a lender who works with those programs
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