5-min read

Good news: Finding the down payment money for your first home may not be as daunting as you think. There are several options available to help with the down payment on a house, but many buyers don’t know about them. We’re here to provide several down payment options so you can see if you may be eligible.

What is down payment assistance?

Down payment assistance can include loans, grants, tax credits1 and other programs designed to help eligible home buyers cover down payment or even closing costs. These programs are offered by federal, state, county or local government agencies, nonprofits or employers. Availability and qualification requirements vary by state. The American Dream program, offered by U.S. Bank, helps consumers with limited resources become homeowners, especially low-to-moderate income (LMI) borrowers and in LMI neighborhoods.

Get a glimpse into how down payment assistance programs work.

As a bank, we partner with Housing Finance Agencies (HFAs), government municipalities and nonprofit partners across the U.S. to make down payment programs available for potential home buyers. These programs provide first-time home buyers with money to cover some or all of their down payment. And some programs even help with closing costs.

Down payment assistance comes in many forms, but some of the most common include:

  • Second mortgages with zero percent interest
  • Grants, which are not required to be repaid
  • Loans that may be deferred, due upon sale, refinance or payoff of first mortgage
  • Loans that may be forgiven, typically a second mortgage with zero percent interest that’s forgiven over a specific number of years as long as the borrower remains in the home for that amount of time
  • Mortgage Credit Certificates (MCCs), an annual federal income tax credit1 that helps offset interest expenses
  • Gifts from family members and friends, while this may not be a formal down payment assistance program, it is a common form of assistance for many first-time home buyers

There are several other programs and options out there that can help remove the barriers to homeownership. The range of programs available may vary based on where you’re looking to buy a home. Our knowledgeable mortgage loan officers are a great resource for helping you understand your options.

Find out if you’re eligible for down payment assistance.

The requirements for each program vary, but are typically based on your income, the price of the home and your history as a homeowner. Assistance is available only for a home you plan to occupy and isn’t available for vacation homes or investment properties. Many down payment assistance programs are for first-time home buyers, but don’t count yourself out if you’ve previously owned a home. If you have not owned a home in the last three years, you may be considered a first-time home buyer.

We can help you get past the down payment hurdle.

Since there are hundreds of down payment assistance programs available, it can be a challenge knowing where to start. For more information about what kind of assistance may be available in your area, contact a mortgage loan officer. We can help you navigate your options so you can focus on the fun things, like picking out your new furniture.

Down payments might be one of the most daunting parts of the home-buying process. We understand, it can be a lot of money. But taking advantage of down payment assistance programs such as loans, grants and tax credits1 can put your mind at ease. And we can help guide you through the process.

Ready to make your dream of homeownership a reality?

Let’s get you closer to your new home.

Prequalification helps you see how much you might be able to borrow.

Prequalify

Related topics

 

How much house can I afford?

See how much house you could afford.

Learn more

How much should my down payment be?

Determine your ideal down payment.

Learn more

How does my credit score affect my mortgage rate?

Learn how to maximize your credit score.

Learn more