Homebuyers

How Down Payment Assistance Programs May Help You Buy a Home Sooner

For many would-be homebuyers, the biggest hurdle isn’t finding the right home or qualifying for a mortgage. It’s coming up with enough cash for the down payment.

The good news is that saving on your own isn’t your only option. Thousands of down payment assistance programs across the country help buyers cover upfront costs. This is typically done with grants or low-cost loans tailored to first-time homebuyers or specific professions and regions. Some programs will also work with repeat buyers.

Nationally, there were 2,619 down payment assistance programs available in the fourth quarter of 2025, according to Down Payment Resource. It provides a program database and resources for buyers and housing professionals.

However, many buyers don’t know if they qualify for these programs or that they even exist.

“The first obstacle is just awareness,” said Down Payment Resource CEO Rob Chrane. “Don’t assume immediately that you’re not eligible for programs. It doesn’t cost you anything to find out.”

Here’s what to know about finding and applying for down payment assistance.

What is down payment assistance?

Down payment assistance is financial help designed to cover part (or sometimes all) of your upfront homebuying costs. This includes the down payment and occasionally closing costs, generally for primary homes.

These programs typically come in three main forms: 

• Down payment assistance grants: Think of these grants like a gift. You typically don’t need to repay the money, provided you follow the rules of the program. This may include staying in the home for a certain amount of time.
• Loans: These can be low-interest or deferred-payment loans. Some require monthly payments, while others don’t need to be repaid until you sell the property or refinance your mortgage.
• Forgivable loans: These loans are gradually forgiven over time. For example, some are structured to forgive 20% per year over five years.

Many down payment programs can be paired with a range of home loans, including Conventional, Federal Housing Administration (FHA), U.S. Department of Agriculture (USDA) and U.S. Department of Veterans Affairs (VA) loans.

These programs not only reduce stress when it comes to your down payment, but can also help prospective homeowners enter a buyer’s market more easily. They can also preserve savings for emergencies, repairs, and other expenses, said New American Funding Senior Vice President of Strategic Growth and Expansion Mosi Gatling.

Who qualifies for down payment assistance?

Down payment assistance eligibility varies by program. Many are designed for first-time buyers (often defined as someone who hasn’t owned a home in the past three years) or buyers within certain income limits.

Others are designed for buyers in specific professions, such as teachers or healthcare workers or those who served in the military.

They may also be allocated for individuals purchasing in specific geographic regions, such as rural areas or a specific state. And some are designed for those with disabilities or from certain racial backgrounds.

You’ll often need to meet requirements related to your credit score, debt-to-income (DTI) ratio (how much money you earn compared to your debts) and loan-to-value (LTV) ratio (the amount of money you’re borrowing compared to the property’s value.)

The key takeaway? Don’t assume you won’t qualify. Many programs have broader criteria than most people expect.

Eligibility for repeat buyers and those making more than $100,000 per year is expanding, with 10% of programs nationwide having no income limits, according to recent data from Down Payment Resource.

How to find down payment assistance programs

With thousands of programs nationwide, starting your search can feel daunting. The following resources can help.

• State housing finance agencies: Nearly every state offers its own programs. Chrane recommends starting with a visit to your state agency’s website, which will list programs and participating lenders.
• Local governments: Every U.S. county offers at least one homeownership program, as do many cities and municipalities.
• Lenders and loan officers: Many lenders work directly with down payment assistance programs and can help match you with options.
• Nonprofit organizations: Housing-focused nonprofits frequently administer or connect buyers to funding.

One strategy is to start your search online by using terms such as “down payment assistance programs in [your state or city].” Online databases and tools can match you with options based on your income and goals.

How to apply for down payment assistance

Once you narrow down your options, the application process is more straightforward than most people expect, especially if you work with a knowledgeable lender.

Depending on the program, your lender may submit the application on your behalf, or you may apply directly through a program website or online portal. In either case, be prepared to gather and supply the necessary documents and information, such as credit score, income verification, tax returns, and employment history.

Since some programs have limited funds and operate on a first-come, first-served basis, applying early in the homebuying process is recommended.

Chrane recommends getting started with the process as part of your initial outreach to a mortgage lender.

“Everybody’s told to get prequalified for a mortgage,” he said. “But get prequalified for the [DPA] programs that that lender may offer.”

What to expect when applying for down payment assistance: Amounts, timelines, and stipulations

Programs may offer anywhere from a few thousand dollars to 3% to 5% of the home’s purchase price. Some even go higher in more expensive areas.

Approval can take anywhere from a few days to several weeks, depending on the program and demand.

Pay attention to program-specific stipulations, which may cover:

• Occupancy requirements: You typically need to live in the home full-time, often for a number of years.
• Purchase price: High-value properties may fall outside of program limits.
• Homebuyer education: You may need to complete a course or workshop related to your program.
• Resale and refinancing restrictions: Selling too soon could trigger needing to repay the assistance. Some programs also require repayment if you refinance early.

Myths about down payment assistance

Despite the benefits of down payment assistance, many misconceptions remain. These include that the help is hard to access.

Some buyers also fear that applying for assistance will slow down the process of closing on a property, making them less competitive. However, that is not the case, said Gatling.  

So, don’t be too shy to ask about the programs you qualify for and work with your lender and homebuying team to apply early. This way you avoid leaving funds on the table.

“Most of these programs are pretty generous, so any help you can get is worth a little bit of extra effort,” Chrane said.

Mosi Gatling NMLS# 557166