Colorado First Time Home Buyer Incentive & Down Payment Assistance [2021]

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PRO TIP: For most of these programs, you do not have to be a First Time Home Buyer In Colorado to be eligible. Those that have previously owned but do not currently own can be eligible.

Would you prefer to own your own home instead of renting one but think that purchasing a home is financially out of reach? If this is a question you have asked yourself before, you are not alone.

A recent study by Freddie Mac finds that two-thirds of those renting today do not know that they can afford to buy and own a home.

Because of that, today’s renter continues to endure, among other things, the certainty of rising rents and the possibility of having to move at the end of every lease term if the property owner does not agree to renew the lease.

HOWEVER, this guide will show you several programs and incentives available for the Colorado first-time home buyer (and even for those that have previously owned a home) that make buying a home not only possible but, in most cases, less expensive than renting.

Simply put, these programs open the door to homeownership for thousands of people and families every year that otherwise would still be renting today. Finding the right first time buyer mortgage plan for you can be daunting, but this is one of the first steps to buying a house for the first time or becoming a renewed homeowner.

PRO TIP: In traditional mortgage financing, a “first-time homebuyer” is defined as someone who has not owned a home in the last three or more years.

The Two Most Common First Time Home Buyer Myths

So, the two most common myths around buying a home are that there is a large down payment required and that one needs excellent credit before considering purchasing a home.

If this is you, don't worry, this is a common but inaccurate assumption.

Those Myths Dispelled

Below we will show you the numerous down payment grants and mortgage assistance programs available for today's first time home buyers in Colorado. Most of these programs also accept “fair” credit scores, therefore effectively dispelling those myths. We have included the minimum credit score for each program below.

These programs include first time home buyer closing cost assistance programs, CHFA down payment assistance, first time home buyer Colorado tax credits (when available), and Colorado first time home buyer grants.

It is essential to know that not every lender has access to these 1st time home buyer programs in Colorado. Because of that, you will want to confirm which of these loan programs listed below the lender you contact can offer.

Your Options Without The Colorado First Time Home Buyer & Down Payment Assistance Programs

Outside of the first time home buyer government programs, such as the VA Home Loan, for prior or active duty military and the USDA Home Loan, for rural areas, the two next best first time home buyer programs are the Conventional Loan and the FHA Loan.

The Conventional Loan, with an approved loan application, allows a 3% down payment option. On the other hand, the FHA loan has a 3.5% down payment.

Using either the Conventional loan with a 3% required down payment, or the FHA loan with a required 3.5% down payment on a $250,000 home, you are required down payment would be $7500 (at 3%) - $8750 (at 3.5%), which is a relatively substantial amount of money.

The good news is, alternatively, the majority of the programs listed below offer a $0 - $1000 down payment.

As you can see, getting complete and accurate information on these programs can be difficult because they are not widely advertised.

But, that information and the advantages these programs offer can be the difference between owning and investing in your own or someone else’s.

Find The Loan Program That Can Put You In Your Home

Review the first time home buyer qualifications of these programs below to arm yourself with the information you need to pursue buying and owning your own home.

It is important to note that many of these Down Payment Grants and First Time Homeowners Programs are available to those that have previously owned a home.

Lastly, to prevent any confusion when using any of the programs below, it is essential to know that you will still have an underlining loan, like Conventional, FHA, and VA.

The First Time Home Buyer Programs and Down Payment Assistance Colorado Programs do not stand alone as a mortgage loan but attach to one of the primary underlining loans.

So you will still see FHA/Chfa, CONV/ Chfa, etc., on your loan application and documents.

Prefer a quick list of the programs you are eligible for vs. studying all of these programs? We Have Free Tool For That!
[CLICK HERE] for a Free Tool that will provide you a list of every program that could open the door to homeownership.

LOAN PROGRAMS & DOWN PAYMENT ASSISTANCE PROGRAMS TABLE OF CONTENTS

CHFA - COLORADO HOUSING FINANCE AUTHORITY FIRST TIME HOME BUYER LOANS & DOWN PAYMENT ASSISTANCE PROGRAMS

CHFA
CHFA First Step & First Step Plus
CHFA Home Access & Home Access Plus
CHFA Smart Step & Smart Step Plus
CHFA Preferred & Preferred Plus
CHFA Section 8 Homeownership
CHFA Very Low Income Program

NATIONAL & FEDERAL LOAN PROGRAMS

VA - Veteran Affairs Home Loan
U.S. Dept. of Agriculture

First time home buyer programs and down payment assistance programs for Colorado

CHFA - Colorado Housing And Finance Authority Loan Programs

Who it is for: First time home buyers, previous homeowners, and qualified veterans.

Terms: A 30-year, a fixed-rate mortgage can be paired with a 3% down payment grant or a 4% zero-interest second mortgage (silent second) that can help with down payments, closing costs, and more.

Qualified areas: Statewide

Minimum credit score: 620

Minimum down payment: $1,000

More details: CHFA offers numerous financing programs and opportunities to accommodate an array of today's home buyers. To be eligible to receive financing, borrowers must have a credit history and take a home buyer education course (in person or available online). Several more specific CHFA programs are tailored to more specific needs. These are all outlined down below.

CHFA Preferred / Preferred Plus Program

Who it is for: This is a first time home loan program for low to middle-income range buyers.

Terms: The first time home buyer loan requirements for this program offer a 30 year fixed loan interest rate, second mortgage for up to 4% of first mortgage loan amount (silent second), mortgage insurance (PMI) coverage up to 18%, potential 4% in loan assistance.