First-Time Homebuyer Programs and Grants in 2026
Buying your first home is one of the biggest financial steps you can take. The good news is that there are programs to help. Federal, state, and local governments offer first-time homebuyer grants, down payment assistance, and low-interest loans.
This guide explains the best programs available in 2026 and how to qualify for them.
What Counts as a First-Time Homebuyer?
Most programs define a first-time homebuyer as someone who has not owned a home in the past three years. That means you can qualify even if you owned a home before, as long as you have not owned one recently.
Federal First-Time Homebuyer Programs
FHA Loans
FHA loans are backed by the Federal Housing Administration. They let you buy a home with as little as 3.5% down if your credit score is 580 or higher. If your score is between 500 and 579, you need 10% down.
FHA loans are popular with first-time buyers because they are easier to qualify for than conventional loans. The trade-off is mortgage insurance. You pay an upfront fee of 1.75% of the loan and a monthly premium for the life of the loan in most cases.
VA Loans
VA loans are available to military veterans, active-duty service members, and surviving spouses. They require no down payment and no mortgage insurance. The VA loan is one of the best mortgage deals available in the US.
You need a Certificate of Eligibility from the VA to apply. Lenders also have their own credit and income requirements, though the VA has no official minimum credit score.
USDA Loans
USDA loans are for homes in rural and some suburban areas. They require no down payment. Income limits apply — you generally need to earn at or below 115% of the area median income.
Use the USDA’s online map to see if a property qualifies. Many areas outside major cities are eligible.
Good Neighbor Next Door Program
This HUD program offers a 50% discount on homes in revitalization areas for teachers, police officers, firefighters, and EMTs. You must live in the home for at least 36 months. Properties are listed on the HUD website for seven days before becoming available to the general public.
Down Payment Assistance Programs
Down payment assistance (DPA) programs provide grants or low-interest loans to help cover your down payment and closing costs. Most programs are run by state or local housing agencies.
State Housing Finance Agency Programs
Every state has a housing finance agency (HFA) that offers first-time buyer programs. These typically include:
- Below-market mortgage rates
- Down payment assistance of $5,000–$25,000
- Deferred or forgivable second mortgages
Income and purchase price limits apply. Search for your state’s HFA program using the National Council of State Housing Agencies directory.
Fannie Mae HomeReady Loan
The HomeReady program from Fannie Mae allows a 3% down payment on conventional loans for low-to-moderate income buyers. Mortgage insurance is required but can be cancelled once you reach 20% equity. You must complete a homebuyer education course.
Freddie Mac Home Possible Loan
Similar to HomeReady, Freddie Mac’s Home Possible program offers 3% down with reduced mortgage insurance for income-eligible buyers. You can use gifts, grants, and employer assistance for the down payment.
Homebuyer Grants
Some programs give money that does not need to be repaid. These are called grants.
National Homebuyers Fund
The National Homebuyers Fund (NHF) offers down payment assistance of up to 5% of the loan amount. It is available through participating lenders in most states. The assistance comes as a grant — you do not pay it back.
Bank of America Community Homeownership Commitment
Bank of America offers down payment grants of up to $10,000 and closing cost grants of up to $7,500 in eligible areas. These are true grants with no repayment required. Income and purchase price limits apply.
Chase Homebuyer Grant
Chase offers up to $7,500 as a grant for home purchases in designated areas. The money goes toward closing costs or your down payment. No repayment is required.
First-Time Homebuyer Tax Credits
Congress has proposed a $15,000 First-Time Homebuyer Tax Credit in recent years. As of 2026, this has not been signed into law. Check with a tax advisor or the IRS for the latest status on any federal homebuyer tax credits.
Some states offer state-level mortgage credit certificates (MCCs), which let you deduct a portion of your mortgage interest directly from your federal tax bill each year. This can reduce your effective interest rate significantly.
How to Qualify for First-Time Buyer Programs
Requirements vary by program, but common criteria include:
- Income at or below a certain limit (usually 80%–120% of area median income)
- Credit score of 620 or higher (some programs go lower)
- Purchase price below the program’s cap
- Completion of a homebuyer education course
- Using the home as your primary residence
Steps to Take Now
- Check your credit score. Know where you stand. A score of 620+ opens most programs. A score of 740+ gets you the best rates.
- Save for your down payment. Even with assistance, you may need 1%–3% of the purchase price.
- Research your state’s HFA. Find your state housing finance agency and see what programs are available in your area.
- Get pre-approved. Talk to lenders who participate in first-time buyer programs. Ask specifically about down payment assistance in your area.
- Take a homebuyer education course. Most programs require it. HUD-approved courses are available online for about $75–$100.
Bottom Line
First-time homebuyer programs can put homeownership within reach even if you do not have a large down payment saved. FHA loans, state HFA programs, and bank grants are worth exploring before you assume you cannot afford to buy.
The best place to start is your state’s housing finance agency website. From there, a HUD-approved housing counselor can help you figure out which programs you qualify for.
See also: What Is a HELOC? How Home Equity Lines of Credit Work in 2026