🔹 What is DPA?

 

The DPA (Down Payment Assistance) program helps cover the down payment and a portion of the closing costs needed when purchasing a home. It is especially common for first-time homebuyers or low- to moderate-income borrowers.

 

At Loan Factory, we review and inform you about any eligible local DPA programs as part of the approval process.

 

DPA programs are typically offered by the following types of organization

 

  • State and local housing agencies

  • Nonprofits

  • Lenders partnered with government or grant programs

 

🔹 Common Types of DPA Programs

 

  1. Grants

    • Do not need to be repaid.

    • Often income or area-based.

  2. Forgivable Loans

    • 0% interest and forgiven after a set period (e.g., 5–10 years) if you stay in the home.

  3. Deferred-Payment Loans

    • No monthly payments required until you sell, refinance, or pay off the first mortgage.

  4. Low-Interest Second Loans

    • Require monthly payments but at a lower interest rate than traditional loans.

 

🔹 Typical Eligibility Criteria

 

  • First-time homebuyer (often defined as not having owned a home in the past 3 years)

  • Income limits (usually based on area median income)

  • Purchase price limits

  • Property must be primary residence

  • Minimum credit score (typically 620+)

  • Homebuyer education course may be required

 

🔹 Examples of Popular DPA Programs

Program Description
FHA DPA Some lenders offer DPA with FHA loans. Can pair with local grants or 2nd mortgage.
HomeReady / Home Possible Fannie Mae & Freddie Mac low-down-payment loans with DPA options.
State Housing Agencies (e.g., CalHFA, NJHMFA, NYSHCR) Each state has its own DPA programs with unique benefits.
Chenoa Fund Nationally available program offering forgivable or repayable second mortgages.

 

🔹 Pros and Cons

 

✅ Pros:

  • Reduces upfront cost barrier.

  • Helps buyers qualify sooner.

  • May combine with other programs (grants, tax credits).

 

❌ Cons:

  • Income and purchase price limits.

  • May have higher interest rates or extra paperwork.

  • Sometimes limits on refinance or resale within a few years.

 

 

 

Several state-specific DPA programs:

 

🏡 California (CA)

 

  • CalHFA MyHome Assistance Program: Up to 3–3.5% of the purchase price as a deferred-payment, zero-interest second loan.

  • California Dream For All: Shared appreciation loan (currently paused).

  • CalPLUS with ZIP: Offers a slightly higher interest rate with built-in closing cost assistance.

 

🏡 New Jersey (NJ)

 

  • NJHMFA DPA Program: Up to $15,000 forgivable loan for down payment/closing costs.

  • Smart Start Plus Program: Up to $22,000 for qualified first-generation homebuyers.

  • NJCC DPA Program: Up to $30,000, forgiven after 5 years in most cases.

 

🏡 Alabama (AL)

 

  • AHFA Step Up Program: Up to $10,000 or 4% of the home price as a 10-year second mortgage.

  • City Programs: Cities like Huntsville and Birmingham offer up to $10,000 as forgivable or deferred loans.

 

🏡 Georgia (GA)

 

  • Georgia Dream Program:

    • Standard: $10,000

    • Protectors, Educators, Nurses (PEN): $12,500

    • Hardest Hit Areas: $15,000 (limited availability)

    • All are 0% interest, repayable upon sale or refinance.

 

  • County Programs:

    • Cobb, Gwinnett, and Clayton counties offer separate DPA loans, often up to $10,000.

 

🏡 Texas (TX)

 

  • TSAHC Programs (Texas State Affordable Housing Corporation):

    • 2–5% assistance as grants or repayable second loans.

    • No first-time buyer requirement.

 

  • TDHCA My First Texas Home / My Choice Texas Home:

    • First-time or repeat buyers with fixed-rate mortgages and DPA.

 

  • City Programs (e.g. Austin, Fort Worth):

    • Up to $25,000–$40,000 available depending on income and household size.

 

🏡 Virginia (VA)

 

  • Virginia Housing DPA Grant:

    • Up to 2–2.5% of home price, no repayment required.

 

  • DHCD DPA Program:

    • Up to 15% of home price + $2,500 for closing costs.

    • Must be ≤80% of Area Median Income (AMI).

 

🏡 Colorado (CO)

 

  • CHFA DPA Program:

    • Up to $25,000 or 4% of loan amount in assistance.

 

  • MetroDPA (Denver area):

    • Up to 6% assistance.

    • Income limit: ~$176,700; Credit score: 640+

 

🏡 Illinois (IL)

 

  • IHDAccess Programs:

    • Forgivable: $6,000 over 10 years

    • Deferred: $7,500 repayable when home is sold

    • Repayable: $10,000 over 10 years

 

  • City of Chicago / Cook County:

    • Up to $25,000 or 5% of purchase price

 

  • Other Programs: CHA, NHS, FHLBank offer $5,000–$30,000 assistance

 

🏡 Nevada (NV)

 

  • Federal Home Loan Bank (FHLB) DPA:

    • Up to $50,000 in forgivable down payment help.

 

  • Nevada Housing Division – Home Is Possible (HIP):

    • 2–5% assistance with FHA, VA, USDA, or Conventional loans.

    • Must meet income and purchase price limits.

 

✅ General Notes

  • Most programs require:

    • Primary residence only

    • Income limits (often tied to area median income)

    • Minimum credit score (typically 620–640+)

    • Homebuyer education course

  • Programs may run out of funds, so early application is important.

  • You can layer many of these programs with grants or other subsidies.

 

 

 

 

 

 

 

Terry Kwon

Contact: (631) 624-4480

Email: terry@milestonepointinc.com

 

Funding Director at Milestone Point, Inc.

Licensed Mortgage Originator at Loan Factory

NMLS #2620208

Loan Factory NMLS #320841