Home Buyers Down Payment Assistance Programs
- Rowena Patton
- 3 hours ago
- 5 min read
Lenders - have programs for buyers? Enter them here. Please enter one program per form. More lenders coming soon!
Disclaimer: Program availability, terms, conditions, and eligibility requirements are subject to change at any time without notice. Information provided by lenders is for general reference only and does not constitute a commitment to lend, extend credit, or offer financial assistance. All program details must be verified directly with the lender or a licensed mortgage professional. No warranties or representations are made regarding accuracy, completeness, or current availability.
Government and local organization programs below lender chart
Home Buyers Down Payment Assistance Programs from national and local organizations
Payment Assistance Comparison Chart
Program | Location | Max Assistance | Forgivable? | Interest / Terms | Key Eligibility |
Chenoa Fund – FHA Forgivable | National | Up to 5% | Yes, after 36 on-time payments | 0% soft second | FHA borrower |
Chenoa Fund – FHA Repayable | National | Up to 5% | No | Repayable 2nd mortgage | No income limits |
NHF – 10-Year ‘2 Plus’ | National | 3.5–5% | No | 10-year amortized | First-time NOT required |
NHF – Forgivable/Deferred | National | Up to 3.5% | Yes, per program rules | Deferred | Flexible guidelines |
Compass Working Capital (POAH/FSS) | National | $20,000 grant | Yes | Grant—no repayment | Must be POAH resident + FSS participant |
Appleton Housing / SECURA Grant | National | $5,000 | Yes after 5 yrs | 0%, no lien | Must be employee of SECURA |
The Banks Foundation | National | $2,500 | Yes | Grant | Transitioning from public housing or welfare-to-work |
Program | Location | Max Assistance | Forgivable? | Interest / Terms | Key Eligibility |
NCHFA – CPLP | NC Statewide | $50,000 or 25% | No | 0%, deferred | Paired w/ NC Home Advantage Mortgage |
1st Home Advantage DPA | NC Statewide | $15,000 | Yes | 0%, forgiven after 15 yrs | First-time buyers or military veterans |
1st Home Advantage – Targeted Areas | NC Targeted Census Tracts | $15,000 | Yes | 0% | NOT required to be first-time buyer |
NC Home Advantage Mortgage DPA | NC Statewide | Up to 3% of loan (≈$10,830) | Partially, yrs 11–15 | 0%, deferred | Not limited to first-time buyers |
NC REALTORS® Housing Foundation Grant | NC Statewide | $1,000 | Yes | Grant | One per household |
NC Home Advantage Tax Credit (MCC) | NC Statewide – Suspended Feb 2025 | Up to $2,000/yr tax credit | N/A | Annual federal tax credit | Income + purchase limits |
MCC – Targeted Areas | NC Targeted Areas – Suspended | Up to $2,000/yr | N/A | Annual tax credit | No first-time requirement |
Program | Location | Max Assistance | Forgivable? | Interest / Terms | Key Eligibility |
MHO – Turn-Key Homeownership | WNC Only | Up to 30% of price | No | Deferred loan + equity share | Must buy MHO-built or renovated home |
OnTrack WNC – Biltmore Passport to Property | WNC Only | $4,500 match (3:1) | Yes (match funds non-taxable) | Savings program + classes | Must save $50/mo for 6+ months; WNC employers |
Why Sellers and Builders Offer Mortgage Buy downs in a Shifting Market
When mortgage rates rise or buyer demand softens, sellers and builders look for effective ways to make their home stand out. One of the strongest tools in a competitive market is the temporary mortgage buydown, especially the well known 2/1 buydown.
A buydown means someone pays upfront to temporarily reduce the buyer’s interest rate. It can be the seller, the builder or the lender. The buyer receives lower monthly payments for the first one to three years, which makes the home more affordable and easier to qualify for.
For sellers, this can be far more powerful than a simple price reduction and is often less expensive.
Why sellers use buy downs
Sellers in a slowing or price-adjusting market usually face the same challenge. Buyers are stretched, monthly payments are higher and fewer people can qualify.
A buy down solves this by creating affordability without permanently lowering the price.
A ten thousand dollar seller credit used for a buydown can reduce the buyer’s monthly payment by hundreds of dollars.• A ten thousand dollar price reduction usually lowers the payment by only fifty to sixty dollars.
Many sellers now choose to advertise that they will provide a temporary 2/1 buy down credit with a full-price offer. This attracts more qualified buyers because they see an immediate, meaningful reduction in their monthly payment while keeping the seller’s final sale price intact.
Why builders use buy downs
Builders use buy downs because they must protect the future value of the entire community. If a builder cuts prices on just a few homes, it hurts appraisals for every home in the neighborhood.
Instead, builders offer incentives such as:
temporary 2/1 or 3/2/1 buydowns• permanent rate reductions• closing cost credits applied to rate improvements• builder funded rate incentives through preferred lenders
This helps them sell without damaging the price structure of their development.
What is a 2/1 buydown
A 2/1 buy down reduces the buyer’s interest rate for the first two years.
Year one is two percent lower.
Year two is one percent lower.
Year three and beyond return to the original note rate.
Buyers get payment relief. Sellers get more attention on their listing. Builders keep values stable.
What a 2/1 buydown costs a seller in 2025 using a 6 percent rate
When mortgage rates trend around six percent, seller-paid buy downs are even more attractive because the cost is lower and the buyer still receives a meaningful payment reduction.
Here are typical numbers.
For a four hundred thousand dollar loan at six percent
Year one subsidy is about seven thousand two hundred dollars.
Year two subsidy is about four thousand dollars.
Total cost is about eleven thousand two hundred dollars.
For a three hundred thousand dollar loan at six percent
Year one subsidy is about five thousand four hundred dollars.
Year two subsidy is about three thousand dollars.
Total cost is about eight thousand four hundred dollars.
For a two hundred fifty thousand dollar loan at six percent
Year one subsidy is about four thousand five hundred dollars.
Year two subsidy is about two thousand five hundred dollars.
Total cost is about seven thousand dollars.
These are estimates, but they reflect what sellers and builders are offering in 2025 across the country.
How a seller offers a 2/1 buy down
Offering a buy down is straightforward.
The seller agrees to provide a credit at closing
The buyer’s lender uses that credit to fund the 2/1 buydown.
An escrow account is created to subsidize the buyer’s payment for the first two years.
The buyer automatically receives the reduced payments.
Your real estate agent writes this into the offer in a way that meets lender guidelines.
Many agents advertise it as “Seller will provide an interest rate buy down credit with a full-price offer,” which signals value without lowering the asking price.
Why buy downs matter in a cooling market
As prices soften or level off, sellers want to avoid repeated price drops. A temporary buy down offers several advantages.
It attracts more buyers.
It helps borderline buyers qualify.
It protects the seller’s final sale price.
It reduces days on market.
It positions the home ahead of competing listings.
It provides immediate value buyers can feel.
It is one of the most noticeable incentives a seller can offer in a buyer's market.
When a 2/1 buy down makes the most sense
Temporary buy downs are especially effective when:
mortgage rates are higher than normal
buyers need early payment relief
sellers want to stand out without cutting price
a home has been on the market longer than expected
builders must protect neighborhood values
buyers expect to refinance within one to three years• a seller wants to attract more qualified buyers quickly
The bottom line
Temporary 2/1 buy downs have become one of the most effective seller incentives.
They help buyers say yes sooner, give sellers a competitive advantage and often have a larger impact than price reductions.
If you are considering selling, talk with your agent about whether a 2/1 buy down or similar incentive could help your home sell faster and more smoothly while protecting your equity.