Down Payment Assistance
Grants, forgivable loans, and assistance programs to help you cover your down payment and closing costs.
Program Overview
Down payment assistance (DPA) programs are designed to help eligible homebuyers — particularly first-time buyers — cover the upfront costs of purchasing a home. DPA can come in the form of grants (free money), forgivable second mortgages, deferred payment loans, or matched savings programs. These programs are offered by state housing finance agencies, local governments, and some lenders.
Who Is This Loan For?
- ✓ First-time homebuyers who need help with upfront costs
- ✓ Borrowers at or below area median income limits
- ✓ Buyers in target geographic areas with DPA programs
- ✓ Homebuyers who qualify for FHA, VA, USDA, or conventional financing
Key Benefits
Reduce Upfront Costs
Cover some or all of your down payment and closing costs through assistance programs.
Multiple Formats
Grants, forgivable loans, deferred-payment loans, and matched savings — options to fit different situations.
Stackable
Many DPA programs can be combined with FHA, conventional, and VA loans.
Widely Available
DPA programs exist in most states — your advisor can check what's available in your area.
Qualification at a Glance
General Requirements
- Typically require first-time homebuyer status (3-year ownership gap)
- Income limits based on area median income
- Must complete homebuyer education course
- Property must be in an eligible area
- Must be used with an approved loan program
Advantages
- ✓ Reduces or eliminates out-of-pocket costs
- ✓ Some programs offer grants (no repayment)
- ✓ Can be combined with FHA, conventional, and VA
- ✓ Widely available across the U.S.
- ✓ Opens homeownership for moderate-income families
Tradeoffs to Consider
- ↔ Income and purchase price limits apply
- ↔ May require holding the property for a minimum period
- ↔ Homebuyer education course usually required
- ↔ Limited to primary residence
- ↔ Some DPA loans must be repaid if you sell early
Common Scenarios
First-Time Buyer with Limited Savings
A teacher earning $50K qualifies for a $10,000 DPA grant from her state housing agency, covering the 3.5% FHA down payment on a $280K home.
Documents Typically Needed
- Income verification
- First-time buyer eligibility documentation
- Homebuyer education certificate
- Purchase contract
- Standard mortgage application documents
Frequently Asked Questions
Most DPA programs define "first-time buyer" as someone who hasn't owned a home in the last 3 years. Some programs also assist veterans and buyers in target areas regardless of ownership history.
Broker Disclosure: Scout Financial Group Inc DBA Airus Lending is a licensed mortgage broker (NMLS #2187418) and does not make loans or credit decisions. Airus Lending works with multiple wholesale lenders to help borrowers compare available loan options. Final approval depends on the lender, automated underwriting findings, documentation, state requirements, and overall borrower profile. Not all applicants will qualify.