First-Time Homebuyer Programs: What’s Available in All 50 States

Every state has a housing finance agency, a state-chartered organization that helps residents buy and rent homes. And each one runs first-time homebuyer programs, usually a lower-rate mortgage, money toward your down payment and closing costs, or both. Rather than apply to the agency, you go through a lender that works with it.

You may qualify even if you’ve owned a home before. Many programs treat you as a first-time homebuyer if you haven’t owned your main home in the past three years.

And you don’t need a big pile of savings to start. An FHA loan, which many state programs are built on, lets you put down as little as 3.5% of the purchase price. On a $250,000 home, that’s $8,750, and state help can cover some or all of it.

What are first-time homebuyer programs?

First-time homebuyer programs are loans, grants, and tax breaks that lower the cost of buying your first home. Most come from your state’s housing finance agency or the federal government. Cities, counties, and nonprofits often stack their own help on top.

How state programs differ from federal programs

Think of federal programs as the loan and state programs as the extras.

Federal programs are loan types. FHA, VA, and USDA loans come from private lenders, but the government insures or guarantees them. That backing is what lets lenders accept a smaller down payment or a lower credit score. The core rules are the same in every state, and none of the three is limited to first-time buyers.

State programs often sit on top of those loans. A state agency’s mortgage is frequently an FHA, VA, USDA, or conventional loan with extra help attached, like a lower rate or a second loan for your down payment. States also set their own income and purchase price limits, usually by county.

Don’t stop at the state level. HUD keeps a list of homebuying programs for every state, including city and county programs you can sometimes combine with state help. Ask your lender which programs you can stack.

Common types of assistance

The biggest difference between programs is whether you’ll pay the money back and when.

Keep in mind that some programs pair down payment help with a slightly higher mortgage rate. Ask the lender to show you the monthly payment both ways before you choose.

‍“Free money” vs. “free for now.”

Grants don’t get repaid. Forgivable loans are forgiven over a set number of years. Leave early, and you may owe some or all of it back. Deferred loans have no monthly payment but come due when you sell or refinance.

Ask for which one you’re getting in writing. And if it’s forgivable, ask how many years and what happens if you move before then.

Who qualifies as a first-time homebuyer

“First time” doesn’t have to mean your very first home. Under Fannie Mae’s definition, you’re a first-time homebuyer if you haven’t owned a principal residence in the three years before you buy. The same rule covers a single parent or displaced homemaker whose only recent ownership was with a spouse.

State programs often use this three-year test, but not always. Some waive it for veterans or for homes in certain areas, and some programs don’t require first-time status at all. Before you rule yourself out, ask the agency whether you need to be a first-time buyer to qualify.

Read more >> How Can I Buy a House for the First Time?

First-time homebuyer programs by state

Your state’s housing finance agency is the place to start. Once you’re on its site, look for:

• Income limits
• Purchase price limits for your county
• A list of participating lenders

Programs and funding change often, so treat our list as a starting point, then confirm the details with the agency before you plan around them.

Alabama

The Alabama Housing Finance Authority (AHFA) runs two main programs:

• Step Up pairs a 30-year fixed-rate mortgage with a second loan for your down payment.
• First Step is a lower-rate mortgage.

AHFA also offers a mortgage credit certificate.

Ask which program fits your income, and whether you can add the tax credit on top.

Alaska

The Alaska Housing Finance Corporation offers a First Home program with a reduced interest rate for first-time buyers. It also has loan options for veterans and for homes in rural areas.

If you’re buying outside a city, ask about the rural options before you settle on a loan.

Arizona

The Arizona Industrial Development Authority’s HOME Plus program pairs a 30-year mortgage with down payment and closing cost help across most of the state. The Arizona Department of Housing lists other state and local options.

Ask whether the HOME Plus help is forgiven or repaid and when.

Arkansas

The Arkansas Development Finance Authority offers below-market-rate first mortgages and a down payment assistance loan you can pair with them. It also offers a mortgage credit certificate.

Ask whether you can use the down payment loan and the tax credit together.

California

The California Housing Finance Agency (CalHFA) offers MyHome, a deferred loan for your down payment and closing costs. Its Dream For All program is a larger shared-appreciation loan for first-generation buyers, awarded by lottery when new funding opens.

Ask a CalHFA-approved lender whether a Dream For All round is open, and if not, whether MyHome fits.

Colorado

The Colorado Housing and Finance Authority (CHFA) offers 30-year mortgages you can pair with a down payment grant or a second loan. Some of its loans are limited to first-time buyers, while others aren’t.

Ask the lender to compare the grant and second-loan options, since the trade-offs between them can be different.

Connecticut

The Connecticut Housing Finance Authority (CHFA) offers lower-rate first mortgages for first-time buyers, plus two kinds of down payment help: a repayable second loan and Time To Own, a forgivable loan for low- and moderate-income buyers that’s forgiven over 10 years.

Time To Own is funded by the state in rounds, so ask your lender whether money is available when you apply.

Delaware

The Delaware State Housing Authority offers first mortgages paired with down payment and closing cost assistance, including options for first-time buyers. Ask which assistance options are reserved for first-time buyers and which are open to anyone who meets the limits.

Florida

Florida Housing Finance Corporation offers first mortgages and Florida Assist, a deferred second loan. Its Hometown Heroes program helps eligible full-time workers, such as teachers, nurses, and police officers, with down payment and closing costs.

Hometown Heroes gets new money once a year, and that money tends to run out. Make sure funds are still available before you count on it.

Georgia

The Georgia Department of Community Affairs runs Georgia Dream, which pairs a first mortgage with down payment help. Some workers, including educators, health care workers, and public safety staff, may qualify for more assistance.

If you work in one of those fields, ask whether you qualify for the higher level.

Hawaii

The Hawaii Housing Finance and Development Corporation offers Hula Mae, a lower-rate mortgage for first-time buyers, and a mortgage credit certificate. Ask whether you can use the tax credit with Hula Mae or with another lender’s loan.

Idaho

Idaho Housing and Finance Association offers first mortgages for first-time and repeat buyers, plus down payment and closing cost assistance as a second loan. Ask how the second loan is repaid and whether it carries interest.

Illinois

The Illinois Housing Development Authority (IHDA) offers IHDAccess mortgages with down payment help that’s forgivable, deferred, or repayable, depending on the option you choose. Ask the lender to show the three options side by side, since the rate and repayment may differ.

Indiana

The Indiana Housing and Community Development Authority offers First Place for first-time buyers and Next Home for repeat buyers, both with down payment assistance. Ask whether the assistance has to be repaid if you sell or refinance.

Iowa

The Iowa Finance Authority offers FirstHome for first-time buyers and Homes for Iowans for other buyers. Either can be paired with down payment help.

Ask whether your county counts as a targeted area, which can loosen first-time and income rules.

Kansas

The Kansas Housing Resources Corporation offers down payment assistance for income-eligible first-time buyers, paired with a first mortgage through a participating lender. Ask whether the assistance is forgiven over time and how long you’d need to stay in the home.

Kentucky

Kentucky Housing Corporation offers first mortgages and down payment assistance loans for first-time and repeat buyers who meet income limits. Ask whether the down payment loan has its own monthly payment, so you can budget for both.

Louisiana

The Louisiana Housing Corporation offers mortgage programs for first-time buyers that can include down payment and closing cost assistance. Ask whether your parish or city offers its own help you can add on top.

Maine

MaineHousing offers the First Home Loan, a lower-rate mortgage for first-time buyers, with an option for down payment help. Ask whether adding the down payment help changes your rate.

Maryland

The Maryland Mortgage Program, run by the state’s Department of Housing and Community Development, offers first mortgages for first-time buyers with down payment assistance.

Some options also help with student loan debt. If you carry student loans, ask about those options first.

Massachusetts

MassHousing offers first mortgages and down payment assistance loans. The Massachusetts Housing Partnership’s ONE Mortgage program offers a lower-rate loan for first-time buyers who meet income limits.

Ask a lender to compare a MassHousing loan with ONE Mortgage at your income.

Michigan

The Michigan State Housing Development Authority (MSHDA) offers the MI Home Loan, a fixed-rate mortgage. You can pair it with the MI 10K DPA Loan, an interest-free loan for your down payment, closing costs, and prepaid costs.

Ask when the DPA loan comes due, so you can plan for it when you sell or refinance.

Minnesota

Minnesota Housing offers Start Up for first-time buyers and Step Up for other buyers. Down payment help comes as a deferred loan or a loan with monthly payments. Ask which one you qualify for, since a deferred loan keeps your monthly cost lower.

Mississippi

Mississippi Home Corporation offers first mortgages paired with down payment assistance, plus a mortgage credit certificate. Ask whether the assistance is forgivable and, if so, how long you’d need to stay in the home.

Missouri

The Missouri Housing Development Commission offers First Place for first-time buyers and Next Step for other buyers. Either can come with cash assistance for closing costs and your down payment.

Ask whether the cash assistance has to be repaid.

Montana

Montana Housing offers lower-rate first mortgages, down payment assistance loans, and a mortgage credit certificate for buyers who meet income limits. Ask whether its down payment loan can be combined with help from your city or county.

Nebraska

The Nebraska Investment Finance Authority (NIFA) offers first mortgages for first-time buyers with optional down payment and closing cost help. Ask whether that help is repaid monthly or when you sell.

Nevada

The Nevada Housing Division runs Home Is Possible, which pairs a 30-year mortgage with down payment assistance. It doesn’t require you to be a first-time buyer.

Ask whether the assistance comes as a grant or a second loan for the option you choose.

New Hampshire

New Hampshire Housing offers first mortgages with optional down payment help, with better terms for first-time buyers who meet income limits. Ask how the terms compare if you’re a first-time buyer versus a repeat buyer.

New Jersey

The New Jersey Housing and Mortgage Finance Agency (NJHMFA) offers a first-time homebuyer mortgage you can pair with interest-free down payment help that’s forgiven after five years. First-generation buyers can get additional help on top.

If neither of your parents owned a home, ask about the first-generation option.

New Mexico

Housing New Mexico offers FirstHome for first-time buyers and down payment assistance loans you can pair with its mortgages. Ask whether the down payment loan is deferred or repaid monthly.

New York

The State of New York Mortgage Agency (SONYMA), part of New York State Homes and Community Renewal, offers lower-rate mortgages for first-time buyers, including Achieving the Dream for lower incomes. You can pair them with SONYMA’s Down Payment Assistance Loan.

New York City buyers can also look at the city’s HomeFirst program. Ask whether you can combine city and state help on the same purchase.

North Carolina

The North Carolina Housing Finance Agency offers the NC Home Advantage Mortgage with down payment assistance, plus extra help for first-time buyers and military veterans. If you’re a veteran, ask about the additional assistance first.

North Dakota

The North Dakota Housing Finance Agency offers FirstHome for first-time buyers, plus down payment and closing cost assistance. Ask whether the assistance is a grant or a loan, and how a loan would be repaid.

Ohio

The Ohio Housing Finance Agency offers mortgages with Your Choice Down Payment Assistance. Its Grants for Grads program offers a lower rate and down payment help to recent college graduates. If you finished a degree recently, ask whether you qualify for Grants for Grads.

Oklahoma

The Oklahoma Housing Finance Agency offers first mortgages with down payment and closing cost assistance for buyers who meet income limits. Ask whether you’ll need a homebuyer education course before closing, so you can finish it early.

Oregon

Oregon Housing and Community Services offers the Oregon Bond Residential Loan for first-time buyers and funds down payment assistance through local partner organizations. Ask the agency which partner handles down payment help in your county.

Pennsylvania

The Pennsylvania Housing Finance Agency (PHFA) offers the Keystone Home Loan and Keystone Advantage Assistance, a second loan for your down payment and closing costs. Ask how Keystone Advantage Assistance is repaid and whether it has a monthly payment.

Rhode Island

RIHousing offers first mortgages for first-time buyers and down payment assistance, including options for buyers in specific communities. Ask whether your city or town is one of the communities with extra assistance.

South Carolina

SC Housing offers Palmetto Home Advantage, a mortgage paired with down payment help, plus programs for first-time buyers and some public service workers. If you work in public service, ask which programs you qualify for.

South Dakota

The South Dakota Housing Development Authority offers first mortgages for first-time buyers and down payment and closing cost assistance. Ask whether the assistance is repaid monthly or deferred until you sell.

Tennessee

The Tennessee Housing Development Agency (THDA) offers the Great Choice Home Loan and Great Choice Plus, a second loan for your down payment and closing costs. Ask whether Great Choice Plus is deferred or repaid monthly.

Texas

Texas has two state agencies:

• The Texas Department of Housing and Community Affairs offers My First Texas Home for first-time buyers.
• The Texas State Affordable Housing Corporation runs Homes for Texas Heroes, for teachers, first responders, and other workers, and Home Sweet Texas.

Ask your lender to compare options from both before you choose.

Utah

Utah Housing Corporation offers FirstHome for first-time buyers and down payment assistance loans.

The state also funds a First-Time Homebuyer Assistance Program for newly built homes. If you’re buying new construction, ask about that program specifically.

Vermont

The Vermont Housing Finance Agency offers MOVE, a mortgage for first-time buyers, and ASSIST, a down payment and closing cost loan. Ask when ASSIST comes due and whether it has a monthly payment.

Virginia

Virginia Housing offers first mortgages, a down payment assistance grant, and a closing cost assistance grant for buyers who meet income limits. Ask whether you can use the two grants together.

Washington

The Washington State Housing Finance Commission offers Home Advantage and House Key Opportunity mortgages, which you can pair with down payment assistance loans. Ask which down payment loans pair with each mortgage, since the two may have different options.

West Virginia

The West Virginia Housing Development Fund offers lower-rate first mortgages and down payment and closing cost assistance loans. Ask whether the assistance loan has a monthly payment or comes due when you sell.

Wisconsin

The Wisconsin Housing and Economic Development Authority (WHEDA) offers first mortgages for first-time buyers and Easy Close, a down payment and closing cost loan. Ask how Easy Close is repaid and how it changes your monthly payment.

Wyoming

The Wyoming Community Development Authority offers mortgages for first-time buyers and down payment assistance loans through participating lenders. Ask whether the down payment loan is repaid monthly or when you sell.

Washington, D.C.

The District of Columbia Housing Finance Agency (DCHFA) runs DC Open Doors, which pairs a below-market-rate mortgage with a deferred down payment assistance loan for first-time and repeat buyers. DCHFA also offers a mortgage credit certificate and DC4ME, a reduced-rate mortgage for D.C. government employees.

The District’s Home Purchase Assistance Program (HPAP) offers interest-free loans for down payment and closing costs to low- and moderate-income first-time buyers. HPAP money is handed out first come, first served each fiscal year, so ask your lender whether funds are still available before you apply.

‍What is a mortgage credit certificate? A mortgage credit certificate (MCC) turns part of the mortgage interest you pay each year into a federal tax credit. A credit cuts your tax bill dollar for dollar, while a deduction lowers the income your tax is calculated on. That makes a credit worth more, as long as you owe enough tax to use it.

Your state or local agency sets the rate, anywhere from 10% to 50%. Pay $10,000 in interest with a 15% certificate, and your credit is $1,500. If you itemize, you can still deduct the other $8,500. Rates above 20% cap the credit at $2,000 a year.

Two things to ask before closing: whether you need to apply for the MCC before you close, since it typically has to be issued before closing, and whether you’d owe part of it back if you sell within the first several years.

When it’s time to claim it, the IRS’s free VITA program can prepare your return if your income qualifies. For anything more complex, talk with a tax professional.

Federal first-time homebuyer programs

Federal programs work the same way in every state, and you don’t have to be a first-time buyer to use them. They’re also the base most state help is built on, so it’s worth knowing which one fits you before you compare state options.

FHA loans

The Federal Housing Administration, part of HUD, insures loans made by approved lenders. That insurance lets lenders offer a down payment as low as 3.5% and more flexible credit requirements. The 3.5% minimum applies to borrowers with credit scores of 580 or higher. Scores from 500 to 579 typically need 10% down, and many lenders set their own higher minimums.

VA loans

VA-backed loans come from private lenders and are guaranteed by the Department of Veterans Affairs. They can help you buy a home without a down payment. You’ll need a Certificate of Eligibility, which confirms your service history, and you’ll still need to meet your lender’s credit and income standards.

USDA loans

The USDA’s guaranteed loan program helps lenders make 100% financed, no-money-down mortgages to low- and moderate-income buyers. The home has to be in an eligible rural area, and household income generally can’t exceed 115% of the area’s median. You can use the loan to buy an existing home or build a new one.

Don’t assume your address won’t count: “Rural” covers more places than you might think, including some small towns and suburbs, so check the address on the USDA’s eligibility map.

USDA loans usually need the agency’s sign-off before closing, which can add time. A USDA pilot program lets some approved lenders handle that step themselves, which may help loans close sooner. When you compare lenders, ask whether they can close a USDA loan without waiting on USDA’s approval.

Good Neighbor Next Door program

HUD’s Good Neighbor Next Door program offers full-time teachers (pre-K through 12th grade), law enforcement officers, firefighters, and emergency medical technicians a 50% discount from the list price on certain HUD-owned homes in revitalization areas. In return, you agree to live in the home as your only residence for 36 months. You sign a second mortgage for the discount, with no interest or payments as long as you meet that requirement.

Homes are limited, each listing stays open for seven days, and HUD picks by random lottery when more than one eligible buyer applies.

Read more >> How to Buy a House With Low Income

How to qualify for first-time homebuyer programs

Most programs look at four things: your income, your credit, whether you’ve taken a homebuyer class, and the home itself. Each agency sets its own limits, so check each program’s page before you start shopping.

Income limits

Most state programs cap how much your household can earn. The limit is usually based on the area median income (AMI), meaning the middle income for your county, and it often goes up with household size. Some programs allow higher incomes in high-cost or targeted areas.

Programs don’t all count income the same way, so find out early whether yours counts everyone who lives with you or only the people on the loan. USDA, for example, counts the income of all adult household members, even if they won’t be on the mortgage.

Credit score requirements

There’s no single minimum credit score across programs. FHA’s minimum is lower than most, but state agencies and lenders often set their own on top of it, and conventional loan versions may require more.

So before you get attached to one program, check its minimum score for the loan type you plan to use. The same program can set a different minimum for its FHA and conventional versions, and your lender or the agency’s program guide can tell you which applies.

Your score isn’t the only number that counts: Lenders will also look at your debt-to-income ratio, meaning how much of your monthly income goes to debt payments.

Homebuyer education courses

Many state programs require a homebuyer education course before you close. Courses cover budgeting, how mortgages work, and what to expect at closing, and many can be taken online.

Check which courses the program accepts before you sign up, since not all of them count. A HUD-approved housing counseling agency can point you to one that’s free or low cost at 800-569-4287. Keep your certificate, because your lender will ask for it.

Property requirements

The home usually has to be your primary residence, not a rental or vacation home. Most programs also set a maximum purchase price, often by county.

Check what kinds of homes qualify, too. FHA loans can be used for properties with one to four units, but some state programs limit you to single-family homes or condos, and the home will need to pass an appraisal.

If a program asks you to live in the home for a set number of years, find out what happens if you need to move sooner, including whether you’d owe some of the assistance back. Jobs and families change, and that answer is easier to hear before you sign than after.

How to get your credit ready before applying

A state program can help with your down payment, but it can’t change what’s on your credit report. Your credit affects whether you’re approved and the rate you’re offered, so start a few months before you apply if you can.

Check your credit reports for errors

Start by seeing what a lender will see. You can get free reports from Equifax, Experian, and TransUnion every week at AnnualCreditReport.com. Checking your own reports doesn't affect your credit scores.

Look for accounts you don't recognize, late payments you don't remember, and balances that look wrong. If you find a mistake, you can dispute it with the credit bureau for free. Disputes fix errors only. Accurate negative information, like a late payment that really happened, stays on your report.

For help writing a dispute, Kikoff's AI Credit Disputes tool generates personalized dispute letters, free for all Kikoff users, with just a few taps.

‍What if you find an account you didn’t open? That can be a sign of identity theft. Report it at IdentityTheft.gov, then dispute the account with each bureau that lists it.

Pay down existing debt

Paying down balances can help in two ways: It lowers your debt-to-income ratio, and it lowers how much of your available credit you’re using.

Say you earn $5,000 a month before taxes and pay $400 toward a car loan and $100 toward credit cards. A new $1,500 mortgage payment would put your total at $2,000, or 40% of your income. Paying off the cards would bring it to $1,900 (38%).

A few things to avoid right before you apply:

• Closing old credit cards, which can raise the share of credit you’re using
• Opening new accounts, which adds a hard inquiry and a new payment.

Ask your lender before you make any big change.

Build payment history with credit-building tools

If you have little or no credit history, lenders may not have enough to go on. A thin file isn’t the same as poor credit, but it does mean you need accounts that report your on-time payments to the credit bureaus, plus time for that record to grow.

Start with what you already pay. Your rent usually doesn’t show up on your credit reports unless someone reports it, so ask your landlord first, since some do. If yours doesn’t, Kikoff’s rent reporting reports your verified rent payments to Equifax and TransUnion. It’s included in every Kikoff plan, and a one-time $50 fee covers reporting up to two years of past rent.

Your phone and utility bills can count too. With Kikoff Premium or Kikoff Ultimate, bill reporting adds your on-time phone, electricity, natural gas, and water payments to your TransUnion credit report. It reports on-time payments only, so a late bill won’t be added.

Other options include a secured credit card, a credit-builder loan, or a credit-building account. Whichever you pick, autopay can help keep a busy month from turning into a missed payment.

Read more >> How to Get a Home Loan With Poor Credit

‍Start with a free conversation
‍Programs vary enough by state that reading about them only gets you so far. A HUD-approved housing counselor can go over your credit, your budget, and which programs you may qualify for, often for free and before you’ve committed to anything. Counselors also tend to know local programs that may not show up on national lists. Call 800-569-4287 to find one near you.

You don’t have to be ready to buy: Talking with one several months ahead gives you time to work on anything in your credit or budget that needs attention.

Bottom line

Every state offers help for first-time buyers, and the federal loans underneath most of it ask for less money down than you might think. Start with your state’s housing finance agency, then ask a participating lender which programs you can combine.

Getting approved is one thing. The rate you’re offered is another, and your credit history shapes both. If you have time before you apply, a Kikoff Credit Account reports your on-time payments to Equifax, Experian, and TransUnion. There’s no credit check to sign up, and plans start at $5 a month. If you’re applying soon, check with your lender before opening any new account.