What Are Down Payment Assistance (DPA) Loans?

Down Payment Assistance (DPA) loans are programs designed to help homebuyers cover the upfront costs of purchasing a home—primarily the down payment and sometimes closing costs. These programs are typically offered by state and local housing agencies, nonprofits, or even employers, and they’re often geared toward first-time homebuyers or those with moderate incomes.

DPA can come in the form of grants, forgivable loans, or second mortgages, depending on the program.

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Benefits of Down Payment Assistance Loans

✅ Makes Homeownership More Accessible

DPA helps reduce or eliminate the biggest barrier to buying a home—the upfront cash. This can make homeownership possible much sooner than expected.

✅ Preserves Savings

With assistance covering the down payment or closing costs, you can preserve your savings for emergencies, home improvements, or other priorities.

✅ Pairs Well with Conventional Loans

Many DPA programs can be combined with a conventional and FHA mortgages, giving you more flexibility and a wide range of loan options.

✅ Low or No Repayment Options

Some DPA programs offer grants that never need to be repaid, or loans that are forgiven after you’ve lived in the home for a certain number of years.

Who Is Eligible?

Eligibility for down payment assistance varies by program, but common criteria include:

  • First-Time Homebuyers: Most programs are aimed at those who haven’t owned a home in the past 3 years.
  • Income Limits: Many programs have income caps based on area median income (AMI), often targeting low- to moderate-income households.
  • Home Price Limits: The home must typically fall under a certain price point based on local market conditions.
  • Primary Residence: DPA is usually for homes you intend to live in—not investment or vacation properties.
  • Credit Score Requirements: Minimum credit scores often start around 620, though requirements vary. Some lenders will go down to 580.
  • Completion of a Homebuyer Education Course: Many programs require you to complete a brief course to ensure you understand the responsibilities of homeownership.

Is Down Payment Assistance Right for You?

If saving for a down payment feels like a major hurdle, a DPA loan could be a game-changer. Whether you're a first-time buyer or simply need a financial boost to get into your next home, down payment assistance can make the path to homeownership faster and more affordable. PFHA also has a down payment assistance program but there are many others.

Want help finding a DPA program in your area? We can connect you with options tailored to your needs. Just reach out!