Down Payment Assistance: What is it and How to Get it?

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Point of Interest

Down payment assistance programs help aspiring homeowners get funding for a down payment. There are a variety of down payment assistance products homebuyers may qualify for.

If you’re interested in buying a home but are worried about your ability to make a down payment, you may have options. Down payment assistance programs exist across the country to help potential homebuyers purchase a home. You might be able to get free money in the form of grants, zero-interest forgivable loans, or another type of down payment assistance. 

Tip: If you have your heart set on working with a particular lender, ask them what down payment assistance programs they offer. That can give you a starting point for your research into what you qualify for.

What is down payment assistance?

Down payment assistance is a form of financial aid for homebuyers to help cover down payment costs when purchasing a home. There are several types of down payment assistance. Grants are a form of gift aid that don’t have to be paid back. Zero-interest, forgivable loans are forgiven as long as the borrower still possesses and resides in the home after a specified period of time.

Zero-interest, deferred-payment loans are where you don’t have to make a down payment until a mortgage reaches the end of the term, a mortgage is refinanced, or the home is sold. There are also low-interest loans that serve as a second mortgage available through down payment assistance programs.

Tip: Boost your credit before applying for down payment assistance, as most programs have credit score requirements. If your score is too low, pay off debt before getting a mortgage so you can qualify for these programs.

How does it work?

Down payment assistance programs are typically offered through state, city and county governments. You can find a down payment assistance program through a local government website to see eligibility and guidelines. When a potential homebuyer meets the criteria, they can go through the application process with a participating lender.

You may also learn about down payment assistance programs by visiting the home loan lenders you’re interested in and asking about the programs they work with.

Who is eligible for down payment assistance?

Eligibility standards will depend on the program. Typically, these programs are only available for first-time homebuyers. There may be exceptions if a homeowner has previously owned a home, but not for a certain amount of years.

There are also usually income limits, where homebuyers need to have low- to moderate-income in relation to the location they’re purchasing a home in. You typically have to have a minimum credit score to qualify, around 640 or better.

Some programs may target homebuyers who work in certain occupations, like local government employees, first responders or teachers. Sometimes you can get down payment assistance if you have military ties.

There may be restrictions on the type of home that is eligible. Generally, the home being purchased will need to be the primary residence for the homeowner. There may also be limits on the price and area of the home.

Some down payment assistance programs will also require that homebuyers attend homebuying education programs that cover topics like financial responsibility and details about the mortgage process.

Down payment assistance programs typically only contribute toward a part of the down payment or home closing costs. Generally, homebuyers still need to contribute at least some of their own funds to the purchase.

How to apply for down payment assistance

To apply for down payment assistance, look for programs offered by your state’s housing finance agency, as well as by your county and city on local government websites. See what the down payment assistance requirements are, including income, location and other home requirements. If you qualify, contact a lender the program is offered through.

From there, apply for a mortgage with the lender. You’ll need to submit personal identifying information, as well as work history, pay stubs, proof of assets, and other financial information. Your lender will work on your behalf to apply for down payment assistance and get you registered.

Once your mortgage is processed and you’re approved for down payment assistance, you can use the grant or second mortgage toward purchasing a qualified home.

The final word

Down payment assistance provides a way for aspiring homeowners to realize their dreams of owning a home. If a down payment is preventing you from purchasing a home, look into local down payment assistance programs to see what you might qualify for.


  • How can I get help with a down payment on a house? In addition to looking into down payment assistance programs, you might also tap into resources from loved ones and family who want to help. Another form of down payment assistance comes in the form of down payment gifts. These aren’t offered by a government or organization, but by someone the homebuyer knows, like a relative. If you’re receiving a cash gift to be used toward purchasing a home, you’ll need to submit a down payment gift letter to your lender.
  • Does down payment assistance have to be paid back? Sometimes it does, and sometimes it doesn’t. When down payment assistance comes in the form of a grant, that is gift aid and doesn’t need to be paid back. Other forms of down payment assistance are loans with long terms, so the money will have to be paid back eventually. Ultimately, it all depends on the circumstances and the terms of the assistance. For example, if you have a zero-interest, forgivable loan that requires you to live in the house for a certain amount of time to be forgiven of the loan, and you move early, you may have to pay back the down payment assistance.

Angelica Leicht

Mortgage Researcher

Angelica Leicht is a writer and editor who specializes in everything mortgage-related for Her work has spanned topics that include lending product reviews, interest rate trends, racial biases in mortgage lending and the role of fintech in lending practices, and has appeared in publications such as Interest, The Simple Dollar, Bankrate, The Spruce, Houston Press and VeryWell, among others.