Trying to buy a BOO-tiful home but don’t have a large savings?

Updated: Jan 12


Down payment assistance can help you open the door to homeownership.

It’s no secret that for many, providing a traditional 20% down payment with today’s home prices can seem like a ghostly nightmare and nearly impossible. The challenge of a larger down payment is even more so if you are a first-time homebuyer, with no equity built from a previous home, or if you are a minority who has experienced historical and systemic challenges that prohibited you from acquiring generational wealth. Did you know that this year 72% of homebuyers put down less than 20% for their down payment?

Waiting to save for that 20% could mean that you miss out on your dream home, fail to take advantage of today’s low interest rates and potentially expose yourself to even higher home prices tomorrow. This may leave some asking; is homeownership even attainable? With down payment assistance solutions, we are here to tell you that homeownership IS still possible.

What is Down Payment Assistance?

Down payment assistance is exactly how it sounds, help with the down payment in order to purchase a home. The programs are typically through state or local agencies, non-profits, state housing finance agencies and even some employers. Most programs are for first-time home buyers however, some offer help to repeat buyers. Did you know that you are still considered a first-time home buyer even if you’ve purchased a home before but not in the last three years?


Taking advantage of down payment assistance programs also allows you to hold on to your savings rather than it all going toward the down payment. By using down payment assistance, your savings stays with you and can be used for a rainy day or for fixes and repairs that go hand in hand with home ownership.

How Does Down Payment Assistance Work?

Down payment assistance programs vary by state and come in different forms. If you qualify for down payment assistance you could get up to 3.5% of your down payment covered. Below are a few common forms of down payment assistance.


Grants – gifted money that does not need to be repaid.

Low or zero interest loans – Second mortgages that are paid monthly along with your primary mortgage.

Deferred loans – Require repayment only after you move, sell or refinance your loan.

Forgivable loans – Second mortgages that are forgiven over a set number of years.


How can I find a down payment assistance program?

There are many different down payment assistance programs across the nation. A good first place to check is the U.S. Department of Housing and Urban Development (HUD) website under their local homebuying programs page.

You can also check out your local state’s Housing Finance Agency or utilize Down Payment Resource, a website that allows you to search for programs in your area.

Chenoa Fund offered by CBC Mortgage Agency, a down payment solution you can trust.

Chenoa Fund is a national down payment assistance program, offered by CBC Mortgage Agency, a federally chartered government entity.

While not limited to first-time homebuyers or those with low-to-moderate income, their program emphasizes helping buyers achieve responsible and sustainable homeownership. One of the ways they do this is by offering over a year of homebuyer education and counseling.

The Chenoa Fund program provides up to 5% down payment assistance for the home price in the form of forgivable second mortgages on FHA-insured loans and FNMA conventional loans.


Visit chenoafund.org to learn more about this down payment assistance program.

*Chenoa Fund offered by CBC Mortgage Agency sponsors the Uhousi Initiative.

Make sure your financial house is in order, before thinking about buying a home.

While a traditional 20% down payment might not be absolutely necessary and while there are down payment solutions out there to help, it is important to note that on the flip side, you still need to make sure your financial house is in order before diving head first into purchasing a home.


Regardless of the price of the home, you will likely need cash saved in order to qualify for a mortgage and you will need to pay for things from your savings during the homebuying process such as: closing costs, home inspections, appraisals and moving costs, to name a few.


Additionally, a smaller down payment often means a larger monthly mortgage payment and the added expense of mortgage insurance.

How do I apply for down payment assistance?

In order to apply for any type of down payment assistance, typically you need to find a lender that is approved with the specific grant or down payment assistance program you’d like to apply for. Most programs will have a list of approved lenders to choose from.


Don’t let a down payment shortfall haunt you and keep you from entering the homebuying arena. Down payment assistance is a responsible way to help you purchase a home!