Down Payment Assistance (DPA) Programs

Down Payment Assistance (DPA) Programs Are Good For:

DPA programs are designed for first-time buyers and moderate-income households who need help covering upfront costs. They’re a great fit for borrowers using FHA, VA, or Conventional loans who qualify for local or state-based assistance to reduce their out-of-pocket expenses.

How It Works

Down payment assistance programs help homebuyers cover the costs associated with purchasing a home, particularly the down payment and closing costs. These programs are primarily aimed at first-time homebuyers or those with low to moderate incomes. Some DPA loans are fully forgivable if you stay in the home for a certain number of years, while others may require repayment only if you sell or refinance within a specified timeframe. A loan officer can explain what applies in your state.

Eligibility Requirements

Eligibility is usually based on income, credit score, and the location of the home. Many programs require buyers to complete a homebuyer education course and work with an approved lender. Most programs require participants to meet specific criteria, including:

• Being a first-time homebuyer (not owned a home in the last three years).
• Purchasing a primary residence.
• Meeting income limits based on area median income.
• Completing a homebuyer education course.

Types of Assistance Available

Assistance may be offered as a flat dollar amount or as a percentage of the home’s purchase price. Some programs cover both the down payment and closing costs, and others may be paired with government-backed loans like FHA or VA.

Grants and Loans

• Grants: One-time cash sums that do not need to be repaid.
• Loans: Often provided at low or zero interest rates, which may be deferred until the home is sold or refinanced.

There are thousands of DPA programs across the country, each with its own rules and benefits. Working with a knowledgeable loan officer can help you navigate your options and make sure you do not leave money on the table.