The Quick Read: Usually yes, but not for every buyer in every place. Help exists in most states, yet there is no single national program, and each one sets its own tests for income, credit, property and lender. Repeat buyers can qualify, since many programs never ask for a first-time buyer. The assistance has to be for an owner-occupied primary home, and the first mortgage underneath it decides which structures are allowed.
What “Any Buyer” Really Means
“Any buyer” is a misconception, and it helps to say so early. Some programs have no first-time-buyer test. Almost every program has some other test: income, price, credit score, occupancy, or whether a participating lender will offer it.
The federal consumer-finance regulator notes that many states, local governments and nonprofits run programs. Many focus on low- and moderate-income first-time buyers, but some serve people who have owned before. Others target teachers, firefighters and other public service workers, or buyers in a particular neighborhood.
So the real question is not “does my state have a program.” It is “which program fits my file, and can my lender place it.” Two buyers in the same town can get different answers.
The Four Shapes Assistance Takes
Assistance comes in four shapes. The shape decides whether you repay anything, and when. Across the wholesale programs Lendmire places files with, the same four show up. The down payment assistance programs page lays out the options.
| Shape | What you repay | Typical size | Credit floor |
|---|---|---|---|
| Grant-style | Nothing to repay | 2% or 3.5% of price | 620 |
| Forgivable second | Nothing, if you stay current | 3.5% of price or value | 640 |
| Repayable second | Monthly payment, balloon in year 10 | 3.5% or 5% of price or value | 660 |
| Refinance-cost second | Repayable, same terms | 1% to 3.5% of balance | 660 |
All figures are through wholesale lenders, subject to program guidelines and full underwriting. Assistance is sized as a percentage of price or value (or of the loan balance on a refinance). It is never a dollar promise.
The grant. It covers 2% or 3.5% of the price toward the FHA minimum investment. It is released at closing with no lien, no interest and no payment. The buyer must complete an HUD-approved homebuyer education course, and the program is not offered in Washington. It pairs with FHA first mortgages only.
The forgivable second. This is a loan, but it carries no interest and no monthly payment. It is forgiven after 36 or 60 on-time first-lien payments, depending on the version. The buyer must not hit a delinquency of 90 days or more.
The repayable second. Call it what it is: a second loan. It carries interest, a monthly payment, and a 30-year amortization with a balloon due in year 10. At 5%, it also covers closing costs and prepaid items. It comes with its own disclosures, separate from the first mortgage.
The refinance-cost second. This one is for owners, not buyers. It helps with closing costs on an FHA refinance. It is never used on a streamline refinance.
Who Qualifies Without Being a First-Timer
No option in the network requires a first-time buyer. A repeat buyer moving up can qualify. A person who sold a home ten years ago can qualify.
Income is where the paths split.
- The two second-lien options have no income limit. The one exception is a USDA first mortgage, which brings USDA’s own income limits.
- The grant uses a household income test. Income must be at or below 140% of the area median income, unless the buyer fits a qualifying category.
- The categories that skip the income test: first responders, educators, medical workers, civil servants, military personnel, first-time buyers, and buyers in an underserved census tract.
Note how “first-time buyer” shows up on that list. It is one way into the grant. It is not a requirement. A first-time buyer is generally defined as someone who has not owned a home in the previous three years, though definitions vary by program, so never assume yours matches.
If you are buying a rental or a second home, stop here. Assistance applies to an owner-occupied primary residence only.
The First Mortgage Decides What Is Allowed
The assistance and the first mortgage are two separate transactions. The agency rules for the first loan decide whether the help is permitted. The assistance provider’s rules decide whether you get it.
The grant pairs with FHA first liens. The forgivable and repayable seconds also pair with USDA and HUD-184 loans. On the USDA side, Rural Development’s own FAQ says assistance programs can be used as long as the guaranteed loan stays in first lien position.
Section 184 deserves a flag. HUD’s Section 184 handbook says the program itself does not provide down payment assistance, so any help comes from a tribe or another source. Buyers on Section 184 loans should confirm source-of-funds rules with the lender.
FHA is the common foundation, so know its basics:
- The minimum required investment is 3.5% of the lesser of price or appraised value, as a 2013 HUD mortgagee letter explains from the statute.
- That same letter says none of the minimum investment can come from the seller or anyone who financially benefits from the deal.
- An upfront mortgage insurance premium applies to the base loan and can be financed. Annual mortgage insurance also applies.
- One-unit FHA loan limits for the year run from $541,287 to $1,249,125 by county.
That interested-party rule matters. A friend with a stake in the sale cannot fund your 3.5%. Public programs and approved providers follow their own documented path.
Not Every Nonprofit Counts the Same on FHA
Here is a trap. Archived HUD guidance says a nonprofit that is not an instrumentality of government can provide secondary financing. But the borrower must still make a down payment of at least 3.5%, and the secondary financing cannot cover any part of it.
A government agency, a state housing finance agency, or an approved entity may be treated differently. Lenders document which one the provider is. This is why buyers who find a program on their own sometimes learn it does not fit their FHA file. That HUD guidance sits on an archived page, so a loan officer should confirm it against current HUD rules.
How to Check Your Own State
No national lookup exists. Use this order.
1. Name your first mortgage. FHA, USDA and HUD-184 each have their own rules on property, income and area.
2. Ask a loan officer which assistance options they place. Not all lenders offer all programs. The Urban Institute notes that offerings vary by state, eligibility is not standard, and not every lender participates.
3. Look at your state housing finance agency. Most agency programs must pair with a first mortgage the agency offers. A few states offer stand-alone help that works with lenders. Many agencies also pass federal funds to cities and nonprofits, and those often have no pairing rule.
4. Check city and county programs. These layer on top of state help in some places. Ask each one whether it can combine with others. Many cannot.
5. Talk to an HUD-approved housing counselor. The CFPB points buyers there to find local programs.
6. Ask whether funds are open. Grant programs tend to run out faster than loan programs, which get replenished from repayments. Reserve funds before you commit to a contract, if the program allows it.
Stacking Is Rare
Within the network, no option can be combined with another down payment assistance program. A mortgage credit certificate is not allowed with the second-lien options. If you hold a local grant, ask whether it blocks the others before you apply.
Some public programs do layer. Others bar it. Get the answer in writing from each administrator, since this is one of the quiet reasons a file falls apart late.
What Happens After Closing
The shape controls the exit.
- Grant: nothing to repay, so a sale or refinance does not trigger a payoff.
- Forgivable second: if you sell or refinance before the 36 or 60 payments are made, the balance comes due. After forgiveness, it is gone.
- Repayable second: you pay monthly. The balloon comes due in year 10, so plan a sale or refinance before then.
Many public programs add occupancy or recapture periods beyond what is described here.
On USDA, the handbook says a down payment assistance second cannot be rolled into a new guaranteed refinance. It must be subordinated or paid in full.
What the File Needs
Assistance does not replace underwriting. The first mortgage still has to qualify. For the repayable second, the monthly payment counts in the debt picture, and the second’s payment is entered as a subordinate lien payment in the automated underwriting system.
Expect to provide:
- A full application and an automated underwriting finding. The second-lien options follow that finding, and manual underwriting is not allowed on the repayable version.
- A homebuyer education certificate for the grant. The borrower pays up front and the cost is credited back at closing.
- Credit that meets the floor for your shape. Blended scores can help the second-lien options when the main earner holds the higher score and earns at least 60% of household income.
- A property that fits. The grant covers 1-4 unit primary residences, FHA-approved condos and PUDs. The second-lien options cover single-family detached or attached homes, condos and PUDs. Unique property types are excluded.
Minor repairs can be handled by escrow holdback on the second-lien options, up to $5,000, with 150% of the estimate escrowed and the work completed on a timeline that varies by file and lender.
Key Terms Defined
Minimum required investment: The part of the purchase price an FHA buyer must pay from their own eligible funds, 3.5% in most cases.
Soft second: A second mortgage with no payment, or a deferred one, often forgiven over time.
Combined loan-to-value: The first loan plus all other liens on the home, divided by the home’s value.
Balloon payment: A large lump sum due at the end of a loan term, here in year 10.
Area median income: The middle household income for your area, used to set limits on some grants.
Common Mistakes
- Treating the grant as a giveaway with no conditions. The grant carries nothing to repay, but it comes with eligibility tests and homebuyer education.
- Forgetting that a repayable second is a loan with a payment.
- Shopping for assistance after signing a contract.
- Assuming a gift from someone with a stake in the sale counts toward the 3.5%.
- Assuming a program is open today without confirming that funds are currently available.
- Applying for a rental or second home. That is not eligible.
Awareness is the larger problem. Research summarized by the Urban Institute and Down Payment Resource found that in the 10 largest metro areas, a substantial share of purchase loans were potentially eligible for assistance. Many buyers never ask.
Frequently Asked Questions
Does every state have down payment assistance?
Most do, but there is no single national program. Each state, city, county or nonprofit sets its own rules, and not every lender offers every program. Lendmire arranges consumer mortgages through wholesale lenders in 16 states, so availability for your file depends on your state and the program.
Can a repeat buyer get down payment assistance?
Yes. The key is the shape you choose and the first mortgage underneath it.
Is there an income limit?
It depends on the option. The grant uses a 140% of area median income test unless you fit a category such as first responder, educator, medical worker, civil servant, military or first-time buyer, or you buy in an underserved tract. The second-lien options have no income limit, apart from USDA’s own limits on a USDA first mortgage.
Do I have to pay it back?
Only some shapes. The grant has nothing to repay. The forgivable second is forgiven after 36 or 60 on-time payments. The repayable second carries interest, a monthly payment and a balloon in year 10.
Can I use it on a rental or second home?
No. Assistance is for an owner-occupied primary residence only.
Where to Start
If you are buying a primary home and want to see whether a down payment assistance option fits your file, Lendmire can help you compare the grant, forgivable and repayable structures alongside an FHA, USDA or HUD-184 first mortgage, subject to lender guidelines and full underwriting. This is not a commitment to lend.
About Lendmire
Lendmire is a mortgage brokerage (NMLS# 2371349) licensed for consumer mortgage lending in 16 states, arranging government-backed purchase loans and the down payment assistance options that sit on top of them through a wholesale lending network. Eligibility is determined by the lender on each file. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
Investors who want the broader program framework can review how DSCR loans work.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. CFPB: Special loan programs
2. HUD Mortgagee Letter 2013-14
3. Urban Institute: Barriers to Accessing Homeownership
4. Urban Institute and Down Payment Resource
This article is part of Lendmire’s down payment assistance program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can You Get Down Payment Assistance After Owning a Home Before? · Repeat-Buyer Down Payment Assistance vs First-Time-Only Grant Programs · Can a Move-Up Buyer Who Still Owns a Home Get Down Payment Assistance?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.