Coming up with a down payment is a big obstacle to first-time homebuyers. It can also be a challenge to existing homeowners who don’t have enough for a down payment on another property. Fortunately, there are down payment assistance programs that many buyers may qualify for. There are around 2,400 programs available nationally, 84% of the properties in the U.S. qualify for such programs, and 36% do not require you to be a first-time buyer. Plus, if you qualify for a few programs, you can “layer” them together to get even more down payment help. Be sure to check with a trusted mortgage professional to discuss your options.

What exactly is down payment assistance? It is money to help you accumulate the down payment and closing costs to purchase a home. Programs that do this are administered by federal, state, and local housing finance agencies, nonprofits, and some employers.

How much down payment do you need? Many people think they need a 20% down payment to buy a home, but FHA and other loan programs have down payments as low as 3.5%. Conventional mortgages are available with down payments as low as 3%. And all these loans can be coupled with down payment assistance programs. However, mortgages with low down payments usually require a minimum FICO credit score. We’d be happy to refer you to a mortgage loan officer who can explain all the details.

What types of down payment assistance are available? Programs include:

Deferred Payment Arrangements (DPA) from federal, state, and local agencies. These provide money for the down payment or closing costs. Amounts typically range from 3% to 7% of the mortgage amount. They’re loaned to you as a second mortgage that usually requires no monthly payments and 0% interest. The loan isn’t due until you sell or refinance the property. Some programs even offer forgivable DPAs that wipe out the loan in a few years’ time.

Grant programs. The good news: this is free money. The bad news: grants make up only about 5% of down payment assistance programs.

Lease-to-own matching programs. Federal Home Loan Banks in 11 regions across the country help renters become homeowners through two lease-to-own programs—the Individual Development and Empowerment Act (IDEA) and the Workforce Initiative Subsidy for Homeownership (WISH). You can find more by clicking here.

Down payment assistance for firefighters, military, and school employees. Many programs are targeted to help the people who serve their local communities.

For more information about these and other types of down payment assistance programs and to see which ones you might qualify for give us a call or send us an email at

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