How Down Payment Assistance Works
Believe it or not, grants to help you buy a house really exist. Down payment assistance helps homebuyers with grants or low-interest loans, reducing the amount they need to save for a down payment.
Provided you qualify, you could receive an outright grant or a low- or no-interest loan to cover your down payment. Some DPA funds can be used for closing costs, too.
Most DPA programs are offered at the local level. And eligibility requirements vary from one program to the next.
Many DPAs require that you be a first-time home buyer with a decent credit score and a low or moderate income. But not all programs have these same rules.
Also note that many DPA programs have a list of participating lenders they work with. So you may have to choose a lender thats approved by your assistance program.
Must Earn Income Thats Above
Eligible home buyers must earn an income thats no more than 20 percent over the median income for a metropolitan area. For example, in Portland, Maine, where the median income is $60,000, home buyers must earn $72,000 per year or less to claim their cash down payment grant.
Income exceptions can be made in high-cost areas, such as New York, Los Angeles, and other cities where the cost of living is high.
In high cost areas, eligible home buyers must earn an income thats no more than 80 percent over the local median income. In San Francisco, eligible home buyers must earn $189,000 per year or less.
Virginia Down Payment Assistance Programs
The Virginia Housing Development Authority has both a down payment grant and a closing cost assistance grant. The down payment grant can be used with FHA or conventional loans, while the closing cost grant can be used with USDA and VA loans. And both programs can be paired with a mortgage credit certificate which reduces your federal tax bill.
Find out more about these down payment assistance grants on the VHDA website. And read HUDs list of other homeownership assistance programs in the state.
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Must Use A Mortgage Backed By Fannie Mae Freddie Mac Fha Va Or Usda
Eligible home buyers must use a mortgage thats backed by one of the five government mortgage agencies Fannie Mae, Freddie Mac, FHA, VA, and USDA. These entities allow for no down payment , 3 percent down payment , and 3.5 percent down payment .
Jumbo mortgages are ineligible for the program, along with other non-qualifying mortgage loans.
Indiana Down Payment Assistance Programs
The Indiana Housing and Community Development Authority has two programs that offer down payment assistance.
- First Place Program: Offers up to 6% of the purchase price for first-time home buyers. Must be used with an FHA loan and requires a credit score of 640 or higher depending on debt-to-income ratio
- Next Home Program: First-time home buyers can get up to 3.5% of the homes purchase price. Must be used with an FHA loan and requires a credit score of 640 or higher depending on debt-to-income ratio . This program can also be combined with IHCDAs Mortgage Credit Certificate
The IHCDA also offers a mortgage credit certificate that can help first-time home buyers and veterans qualify for a better mortgage loan.
For more information on these, visit IHCDAs website. And check HUDs list of other programs in Indiana.
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Kentucky Down Payment Assistance Programs
The Kentucky Housing Corporation offers two down payment assistance programs:
- Regular DPA: Borrow up to $7,500 repaid over 10 years with an interest rate of 3.75%
- Affordable DPA: Borrow up to $7,500. The loan is repayable over 10 years with interest of 1%. But you must be within certain income limits to qualify. Income limits vary by county and household size
For either program, your homes purchase price cant exceed $346,644. Check the KHCs website for more details, including income limits for the Affordable DPA program.
Meanwhile, consult HUDs list of alternative homeownership assistance programs in Kentucky.
Direct Loans For Native Americans
Native American direct loan to Native American veterans They and their formal partners can buy, build, or improve a home on federal trust property. The loan is different than traditional VA loans in that the organization manages it directly. Also known by NADL The loan does not require any down payment nor require that you secure the mortgage.. Additionally, prices are often very affordable and do not limit you to one property. To qualify, you must ensure that properties are located in the right states.
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How To Find Down Payment Assistance Programs
Down payment assistance programs are usually very localized. There are a few national DPAs and many statewide ones, but the majority are run at a city or county level.
The best way to find down payment assistance programs for which you qualify is to speak with your loan officer or broker. They should know about local grants and loan programs that can help you out. Theyll also know which programs the lender can accept .
If you want to do some research on your own, you can also Google down payment assistance grants in . This will help you find current programs specific to your area that you might be able to apply for.
Louisiana Down Payment Assistance Programs
Louisiana has one of the most generous down payment assistance programs. The Resilience Soft Second Loan offers:
- A soft loan of 20% of the home purchase price, up to $55,000
- Up to $5,000 in closing cost assistance for a total of up to $60,000
Better yet, the loan is forgiven after ten years. So as long as you remain in your home at least that long, you wont have to repay anything.
This program is operated by the Louisiana Housing Corporation, and youd need to meet income limits. You cant earn more than 80% of your areas median income.
And, only first-time homebuyers can participate. Louisiana includes single parents who owned a home while married as first-time buyers.
Only homes in the following parishes qualify: Acadia, Allen, Ascension, Avoyelles, Beauregard, Bienville, Bossier, Caddo, Calcasieu, Caldwell, Catahoula, Claiborne, De Soto, East Carroll, East Baton Rouge, East Feliciana, Evangeline, Franklin, Grant, Iberia, Iberville, Jackson, Jefferson Davis, Lafayette, LaSalle, Lincoln, Livingston, Madison, Morehouse, Natchitoches, Ouachita, Pointe Coupee, Rapides, Red River, Richland, Sabine, St. Helena, St. James, St. Landry, St. Martin, St. Tammany, Tangipahoa, Union, Vermilion, Vernon, Washington, Webster, West Baton Rouge, West Carroll, West Feliciana, and Winn Parish.
For more information on this program, visit LHCs website. And look at HUDs list of alternative homeownership assistance programs in Louisiana.
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Down Payment Assistance : What Is It
If you qualify for our programs, TSAHC will provide you with a mortgage loan and funding to use for your down payment. You can choose to receive the assistance as a grant or a deferred forgivable second lien loan . If youre eligible, you can essentially receive free money to help you buy a home. To qualify, you must have a credit score of 620 and meet certain income requirements.
Canada Greener Homes Grant
In an effort to encourage Canadians to live in more energy-efficient homes and help the fight against climate change, the government of Canada introduced the Canada Greener Homes Grant. Grants of up to $5,000 are available to help homeowners make their homes more energy efficient. Theres also up to an additional $600 available for EnerGuide evaluations and expert advice . You can apply for this grant online.
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How Do I Start
You start here, at USAGrantApplication.org. Just click below to get started. You can apply to gain access to our members-only website, where you can easily view the available grants. Once you find one that meets your needs, apply for it!
Our research experts have thoroughly scoured the available grants and grantors and put the important information on our site. If youve ever tried to search for grants online, you know that there is just so much information for you to chase around, only to feel that you are no further ahead after hours of effort. So take advantage of all our work! Get started today and find yourself in your first home soon!
How Do I Apply For These First
First off, you want to make sure that youre eligible for the government scheme/grant for which youre applying. Each program has slightly different eligibility requirements so you want to check off all the boxes prior to submitting your application.
Generally, you can apply for these government schemes and grants at the same time you apply for a home loan.However, if youre planning on using any of the aforementioned grants or schemes, please have a discussion with your bank or mortgage broker prior to submitting your application.
Most lenders will apply for the grant on your behalf once a formal home loan approval is granted, and you have signed any relevant applications/declaration.
For the stamp duty waiver, your solicitor will handle the paperwork for you on settlement day.There can be different eligibility requirements so its best to consult with your mortgage broker or directly with your lender up front.
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Do You Qualify For A Grant To Buy A Home
If you want a grant to buy a house, youll have to qualify for it. Rules vary by program, so the following is just a sample of what youre likely to see:
- Funds are often available on a first-come-first-served basis. So be prepared to wait for funding to be replenished or contact multiple programs
- Not all down payment assistance programs offer grants. Many provide low- or no-interest loans that you pay down in parallel with your first mortgage. Sometimes, those loans are forgiven over time, meaning they turn into grants
- Most DPAs help only first-time home buyers. That often means you cant have owned a home in the last three years. If you owned a home more than three years ago you may still be eligible
- You often need to complete a few hours of housing counseling to qualify.Homeownership education courses are typically offered in conjunction with the grant program
- These grants and loans cannot be used for vacation homes or investment properties. DPA programs provide assistance to buyers needing a primary residence, meaning a home youll live in full time
- Many DPAs have minimum credit scores and maximum income limits. So check their terms and conditions before you apply
- The grant or loan should not be an issue with your mortgage lender. It will just want to be sure you can comfortably afford all your mortgage payments without further assistance
Vermont Down Payment Assistance Programs
The Vermont Housing Finance Agency ASSIST Second Mortgage is open only to first-time buyers. This can provide a loan of $10,000 or $15,000, depending on your income, with 0% interest and no monthly payments. The loan comes due when you sell the home. This down payment assistance must be paired with one of the VHFAs home loan programs.
You can learn more at the VHFAs website. And check out HUDs list of other homeownership assistance programs in the state.
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New Hampshire Down Payment Assistance Programs
New Hampshire Housing has two programs to help first-time home buyers. Home Flex Plus and Home Preferred Plus each provide up to 4% of the sale price in down payment assistance, which is forgiven after four years as long as you dont sell the home, refinance, or file for bankruptcy within that time.
Household income limits apply. In most cases, you cant make more than 80% of your areas median income or up to $151,200 to qualify for aid.
Get more information from the authoritys website. And take a look at HUDs list of other homeownership assistance programs in New Hampshire.
Local Grants And Programs
In addition to the national programs mentioned here, there are many state and local first-time home buyer programs. The National Council of State Housing Agencies provides resources for finding programs in your state. You can also check with the HUD to find local programs by state.
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Land Transfer Tax Refund For First
Like most other provinces, when purchasing real estate in Ontario, youre required to pay land transfer tax. To help with the financial burden, the Ontario government offers a refund on all or part of your land transfer tax, if youre an eligible first-time home buyer.
- Youre at least 18 years old and Canadian citizen or permanent resident.
- Youre a first-time home buyer and so is your spouse .
Things to note:
- Ontario does not allow you to re-qualify as a first-time homebuyer, as you might be able to do under the Home Buyers Plan.
- If either you or your spouse have previously owned a home or an interest in a home anywhere worldwide, you wont qualify.
- The method of acquiring the home is irrelevant, but if you previously received a home as a gift or through inheritance, you wont be eligible for this refund.
How to apply: Qualifying taxpayers may claim an immediate refund at time of registration. You can register electronically, by completing the required statements under the Explanation tab of the electronic land transfer tax affidavit, or by paper, by filing an Ontario Land Transfer Tax Refund Affidavit For FirstTime Purchasers of Eligible Homes form at the Land Registry Office.
First Home Guarantee Scheme
The First Home Guarantee Scheme is one of the main Home Guarantee Schemes that have recently been made available by the Australian Government. It is important to note that this has since replaced the First Home Loan Deposit Scheme and New Home Guarantee .
The FHG is a selective initiative administered and managed by the National Housing Finance and Investment Corporation that aims to assist eligible first home buyers in settling into their first home sooner.
Although the FHLDS and NHG were both limited to 10,000 first home buyers between 1 July 2021 and 30 June 2025, recent changes have seen this increase to 35,000 between 1 July 2022 and 30 June 2023 under the First Home Guarantee.
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Where Can I Find First
Grants are offered nationwide, but the hard part is finding them because most of them are not advertised. As such, you will need to research and ask around to find the options available to you. No matter where you live or are looking to live, there is a local housing authority that can help point you in the right direction on grants that you may be eligible for. So start there. In addition, your realtor and loan officer can help. Remember, youre not the first person to ever need financial help, so theyve been through this before. Both of them have likely worked with people in the same boat as you, so they can advise you of some programs. Your lender may even have a program that they offer themselves, and your state may offer tax credits to first-time buyers. Ask around and do your research.
Also ask your credit union or bank, as many offer their own grant programs to benefit their members and local community. You may even be entitled to a discount if you get a mortgage through a banking institution that you already use. Many non-profits offer grants as well, but one important clarification to make is that the federal government doesnt provide grants to borrowers. Instead, the FHA grants funds to cities and states, which then give grants to borrowers.
How Can You Receive Your $25000 Down Payment Grant
When the Downpayment Toward Equity Act passes into law, it will be an automatic payment made to your closing. Your mortgage lender will facilitate the grant and complete the necessary forms.
All you will be expected to do is buy your home, show up at closing, and find your cash grant waiting.
However, if the bill is moving too slowly for your home purchase timeline, there are other down payment assistance programs for first-time buyers to consider including local incentives and low-down payment mortgages.
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Minnesota Down Payment Assistance Programs
The Minnesota Housing Finance Agency provides two types of down payment assistance loans to eligible borrowers:
- Monthly Payment Loan: Borrow up to $17,000 at the same rate you pay on your first mortgage. Pay that down each month over 10 years
- Deferred Payment Loan: First-time buyers can borrow up to $11,000 free of interest. You make no payments, but the balance will come due when you finish paying off the mortgage, refinance, or sell the home
Discover more at the MHFAs website. And check HUDs list of other homeownership assistance programs in Minnesota.
Are There Restrictions On How I Use My First
Yes, you may use grant funds for down payment on a home, paying closing costs, reducing your mortgage interest rate, and other home purchase-related expenses.
Get pre-approved for a mortgage today.
Dan Green is a former mortgage loan officer and an industry expert. He’s appeared on NPR and CNBC, and in The Wall Street Journal, Bloomberg, and dozens of local newspapers. Dan has helped millions of first-time home buyers get educated on mortgages, real estate, and personal finance. Have mortgage questions? Ask Dan in the chat.
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Section 203 Of The Fha
If you dont want to spend a lot of money on your home renovations or improvements, you might look into section 203 FHA loans. This loan is guaranteed by the institution. After the improvements are made, the loan calculates your homes worth. They will then calculate the value of your home after all improvements have been made. They will lend you money to pay for renovations and let you pay them in small installments. You will be required to make a 3.5% deposit and upgrade must exceed $ 5,000 in order to apply. Make sure that your contractor knows the rules. 203 , Loan Its policies and its repayment times.