Colorado First-Time Homebuyer Programs of 2019

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Updated on Wednesday, February 6, 2019

It’s not hard to imagine why Colorado ranks in the top 10 fastest growing U.S. states. With strong economic and job growth, four major professional sports teams, and tons of opportunities for outdoor recreation year-round, it’s an attractive place to put down roots.

If you plan on buying your first home in the Centennial State, you may be in luck. Colorado has several programs designed to help first-time homebuyers come up with a down payment.

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In January of 2019, we researched first-time homebuyer programs in Colorado. Here’s what first-time homebuyers in Colorado need to know:

Colorado first-time homebuyer programs

The Colorado Housing and Finance Authority (CHFA) works with a network of lenders and community partners throughout the state to help educate homebuyers, offer first-time homebuyer loans and provide assistance with down payments and closing costs. It also offers resources to help at-risk homeowners avoid foreclosure.

Eligibility for CHFA loans

Homebuyers who wish to use a CHFA loan must

  • Have a credit score of 620 or higher (a higher minimum applies to the CHFA Advantage program).
  • Attend a CHFA-approved homebuyer education class in-person or online before loan closing.
  • Make a minimum down payment on the home (funds may come from a gift).
  • Move into and live in the home as their main residence.

In addition to the CHFA program requirements, the lenders administering CHFA programs may impose their own qualification guidelines.

How it works

To get started with any CHFA program, take a free homebuyer education course, either in-person or online. After completing the course, you will receive a certificate of completion from the education provider. You’ll need this certificate to close on a CHFA loan.

Next, contact a CHFA participating lender. The lender will walk you through the loan process from application to closing.

CHFA FirstStep

The CHFA FirstStep program offers down payment assistance in the form of a “silent second” mortgage, which means payments are deferred.

Features

The CHFA FirstStep program offers:

  • Thirty-year fixed-rate loans for first-time homebuyers, veterans, and non-first-time homebuyers purchasing homes in need of renovation in targeted areas.
  • Assistance with a down payment, closing costs and prepaids available through a second mortgage for up to 5% of the first mortgage loan amount. This second mortgage carries no interest and does not have to be repaid until you sell the home, refinance the loan, or the property is no longer your primary residence.

Eligibility

To participate in the program, you must:

  • Be a first-time homebuyer, qualified veteran or a non-first-time homebuyer purchasing in a targeted area.
  • Have income and purchase price within limits that vary by county.
  • Choose an FHA 203(b) mortgage loan.
  • Have a credit score of 620 or higher.
  • Contribute at least $1,000 toward the purchase of the home.

CHFA Preferred

The CHFA Preferred program offers 30-year fixed-rate loans with down payments as low as 3%. This program is not restricted to first-time homebuyers, and down payment assistance is available.

Features

The CHFA Preferred program offers:

  • Thirty-year fixed-rate loans (not restricted to first-time homebuyers).
  • A choice of Freddie Mac “Home Possible Advantage for HFAs” and Fannie Mae “HFA Preferred” conventional loans.
  • Down payments as low as 3% (funds may come from a gift).
  • Down payment assistance in the form of a non-repayable grant available for up to 4% of the first mortgage loan amount, or second mortgage for up to 5% of the first mortgage loan amount. The silent second bears no interest and requires no monthly payments. You’ll have to pay it in full if you sell or refinance the property, or if it is no longer your primary residence.
  • Low monthly mortgage payments.

Eligibility

To participate in the program, you must:

  • Have a credit score of 620 or higher.
  • Have an income of $115,600 or less, regardless of household size.
  • Not exceed the maximum loan limits of the lower of $484,350 or the amount as required by Fannie Mae or Freddie Mac.
  • Contribute at least $1,000 toward the purchase of the home.
  • Be willing to pay private mortgage insurance on any loan with a loan-to-value ratio (LTV) over 80%.

CHFA Advantage

The CHFA Advantage program provides 30-year fixed-rate loans with down payments as low as 3%.

Features

The CHFA Advantage program offers

  • Thirty-year fixed-rate loans for purchases.
  • A choice of conventional uninsured Freddie Mac or Fannie Mae loans.
  • Down payments as low as 3%.
  • No monthly mortgage insurance.

Eligibility

To participate in the program, you must

  • Have a credit score of 680 or higher
  • Not require down payment assistance from a second mortgage unless it meets Fannie Mae’s Community Seconds guidelines or Freddie Mac’s Affordable Seconds guidelines.
  • Have income below the statewide income limit of $115,600, regardless of household size.
  • Contribute a minimum of $1,000 toward the purchase.

CHFA SmartStep

The CHFA SmartStep program provides down payment assistance for FHA, FHA 203(k), VA and USDA Rural Development loans.

Features

The CHFA SmartStep program offers

  • Thirty-year fixed-rate loans available for purchases (not restricted to first-time homebuyers).
  • Choice of FHA, FHA 203(k), VA and USDA Rural Development loans.
  • Down payment assistance in the form of a non-repayable grant for up to 4% of the first mortgage loan amount, or a second mortgage for up to 5% of the first mortgage loan amount. This silent second carries no interest and no required monthly payments. You’ll need to repay it in full if you sell or refinance the home, or it is no longer your primary residence.

Eligibility

To participate in the program, you must:

  • Have a credit score of 620 or higher
  • Not exceed the statewide income limit of $115,600, regardless of household size
  • Have a maximum loan limit within the lower of $484,350 or the amount determined by the applicable FHA, VA or USDA-RD guidelines.
  • Contribute at least $1,000 toward the purchase of the home.

CHFA SectionEight Homeownership

The CHFA SectionEight Homeownership program is designed for first-time homebuyers who receive housing assistance. It provides down payment assistance in the form of non-repayable grants or silent second mortgages.

Features

The CHFA SectionEight Homeownership program offers:

  • Thirty-year fixed-rate mortgages for first-time homebuyers who receive housing assistance payments from Public Housing Authority.
  • A choice of FHA or USDA Rural Development loans.
  • Down payment assistance in the form of a non-repayable grant of up to 4% of the first mortgage loan amount, or a second mortgage for up to 5% of the first mortgage loan amount. The silent second carries no interest and no required monthly payments. You pay it in full if you sell or refinance the property, or if it is no longer your primary residence.

Eligibility

To be eligible for the program, you must

  • Have a credit score of 620 or higher.
  • Not exceed the statewide income limitation of $115,600, regardless of household size.
  • Have a maximum loan limit of $484,350 or the amount determined by the applicable FHA or USDA-RD guidelines.
  • Be a first-time homebuyer or qualified veteran.
  • Contribute a minimum of $500 toward the purchase of the home if you use ACH payments, or $750 for other payment types.

CHFA HomeOpener

The CHFA HomeOpener program helps borrowers get FHA, FHA 203(k), VA and USDA Rural Development loans by providing down payment assistance in the form of a non-repayable grant or a silent second mortgage.

Features

The CHFA HomeOpener program offers

  • Thirty-year fixed-rate loans (not restricted to first-time homebuyers).
  • A choice of FHA, FHA 203(k), VA and USDA Rural Development loans.
  • Down payment assistance in the form of a non-repayable grant available for up to 4% of the first mortgage loan amount, or second mortgage for up to 5% of the first mortgage loan amount. The silent second carries no interest and no required monthly payments. It is paid in full upon sale or refinance, or if the property is no longer the borrower’s primary residence.

Eligibility

To participate in the program, you must

  • Have a credit score of 620 or higher.
  • Have a maximum debt-to-income ratio of 50% for credit scores of 620-659, or 55% for credit scores of 660 and higher.
  • Not exceed income limits, which vary by county and household size.
  • Not exceed the maximum loan amount of the lesser of $453,100 or the limit required by FHA, VA or USDA-RD guidelines.
  • Contribute a minimum of $1,000 toward the purchase of your home.

CHFA HomeAccess

The CHFA HomeAccess program is designed for borrowers with permanent disabilities and custodians of children who have permanent disabilities.

Features

The CHFA HomeAccess program offers

  • Thirty-year fixed-rate mortgages for borrowers with a permanent disability and custodians of a child who has a permanent disability.
  • Choice of FHA or USDA Rural Development loans.
  • Assistance with a down payment, closing costs and prepaids available in the form of a second mortgage available for up to $25,000 at 0% interest. Payments on the second mortgage are deferred until the first mortgage is paid off.

Eligibility

To participate in the program, you must

  • Have a credit score of 620 or higher.
  • Not exceed the maximum loan amount of $453,100 or the amount applicable to FHA or USDA-RD guidelines.
  • Be a first-time homebuyer or qualified veteran.
  • Contribute a minimum of $500 toward the purchase if ACH payments are selected, or $750 for other payment types.
  • Have income within the income limits that vary by county, household size and purchase price.

National first-time homebuyer programs

If you’re interested in buying a home in Colorado, you’re not limited to the first-time homebuyer programs available through the CHFA. There are other programs designed to help first-time homebuyers throughout the country. Check out LendingTree’s guide to first-time homebuyer programs to learn more about programs available nationwide.

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