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Colorado First-Time Homebuyer Programs

Buying a home for the first time can be an exciting but stressful experience. There is a lot to learn about the process and much paperwork to go through — and coming up with the money for the down payment and closing costs can be a challenge.

Help is available to first-time buyers, however. If you’re looking to buy a home for the first time in Colorado, you may be eligible for statewide financial assistance to help you go from home-seeker to homeowner. Take some time to explore the wide range of programs below. You may be able to achieve homeownership more quickly — and more affordably — than you think.

Colorado first-time homebuyer programs

There are several first-time homebuyer programs throughout the state of Colorado, operated by the Colorado Housing Assistance Corporation, the Colorado Housing and Finance Authority and Colorado Housing Enterprises. Each offers unique programs with specific eligibility requirements. All borrowers will have to take a homebuyer education course.

You can check mortgage rates in your area here.

Colorado Housing Enterprises, LLC

Several programs for first-time homebuyers fall under the Colorado Housing Enterprises (CHE) umbrella.

FHA Insured 1st Mortgage

Features

  • Provides mortgage insurance
  • Interest rates are usually the same as market rates
  • Available for single-family properties
    • Includes homes and condominiums
  • Closing cost assistance
  • Down payment assistance
    • Down payment requirements are lower than those required for conventional loans
    • Down payments as low as 3.5%
    • Homebuying classes
      • Learn about the homebuying process, loan products, predatory lending and how to become a smart borrower

Eligibility

  • Credit score
  • “Decent credit” as defined by state of Colorado
  • Available for single-family properties, including condominiums
  • Limit of 1-4 units per property
  • Must be able to afford closing costs
  • Must prove ability to pay mortgage monthly
  • Includes adequate, reliable income to make payments

How it works

Those interested in obtaining a mortgage through the FHA Insured 1st Mortgage program should begin by finding a homebuyer education course in their area. Find a class here.

Conventional loans

Features

  • Offers 30-year, fixed-rate mortgages for first-time buyers
  • Mortgages at competitive market rates
  • Low down payments
    • Minimum 3% down
  • Counseling and education classes offered by CHE

Eligibility

  • Credit score: 620 FICO score required

How it works

CHE encourages all potential homebuyers to begin by seeking out a homebuyer education course. Find a workshop in your area here.

Down Payment Assistance Loan Program

Features

  • Down payment assistance
  • Loan amounts anywhere from $3,000 to $10,000
  • Loan interest rates match first mortgage
  • 10-year loan term
  • Funds can be used for down payment or closing costs
  • Loan is documented as a second mortgage

Eligibility

  • Income qualification
    • Varies by area of residence in Colorado
    • Includes family size
    • Household income required to be at or under 120% of area median income
  • Must be first-time homebuyer
  • Must be buying a residence in Colorado
  • Applicants must allocate at least $500 of their own funds toward the loan
  • Must live in the property
  • Property must be primary residence
  • Attend a counseling session
  • Attend a homebuyer education workshop
    • Workshop must be through HUD and/or Colorado Housing and Finance Authority
  • Required to make automated clearing house (ACH) payments

How it works

If you’re interested in further exploring CHE’s Down Payment Assistance Loan Program, call (303) 428-1448. You can also begin the process by searching for a homebuyer education course in your area.

 90/10 Program

Features

  • Provides portfolio conventional mortgage financing up to 90%
  • Low mortgage insurance at competitive rates
  • Lower monthly payments
  • Become a homeowner with less personal financial investment

Eligibility

  • To receive 90% financing, must be a first-time homebuyer

How it works

Learn more about the 90/10 program and the homebuying process in Colorado by finding a local homebuyer education course in your area.

Colorado Housing Assistance Corporation

CHAC Down Payment Assistance Program

Features

  • Down payment assistance
    • Assistance is for low- or moderate-income buyers
    • Determined by area in Colorado
  • Closing cost assistance
  • Loan is documented as a second mortgage
  • Buyer can prepay loan without penalty
  • When first mortgage has been paid or refinanced, down payment loan will be requested in full

Eligibility

  • Must be a first-time homebuyer in Colorado or not have been a homeowner in the previous three years
  • Property must be primary residence
  • Buyer must fully disclose assets and income for all household members
  • Must attend first-time homebuyer class
    • Class is usually 4 to 6 hours long
    • In-person class is free
    • Online class costs range from $49 to $99 per person
  • If requested, must provide proof of legal residency
    • Must prove legal residency for all household members
  • Must contribute at least $1,000
    • Exception for disability program, in which applicants must contribute $750

How it works

To qualify for the CHAC Down Payment Assistance Program, borrowers must attend an approved first-time homebuyer class. Find a class in person or online here.

Colorado Housing and Finance Authority

The Colorado Housing and Finance Authority (CHFA) offers a range of programs for first-time homebuyers to secure financing, including low-interest loans, down payment assistance and assistance for low-income buyers.

CHFA FirstStep

Features

  • 30-year mortgage term
  • Fixed interest rates
  • Second mortgage available up to 5% of initial mortgage loan total
    • May apply second mortgage toward closing costs, down payment or prepaid expenses
  • Financed through tax-exempt mortgage revenue bonds

Eligibility

  • Must be a first-time homebuyer or veteran
  • Minimum credit score of 620 for scored applicants
    • Borrowers with no scored credit allowed
  • Income limits vary by county
  • Homebuyer education course required
  • Buyers must contribute at least $1,000
    • The $1,000 payment may be a gift
  • Property requirements
    • May be one-unit, single-family, attached or detached home
    • May be a condominium, permanent manufactured housing or planned unit development
    • Must be owner-occupied
    • All borrowers must occupy the residence
  • Cosigners not allowed

How it works

All those interested in the CHFA FirstStep program will need to complete a homebuyer education course either in person or online. You can find more information on attending a homebuying class here.

CHFA Advantage Purchase

The CHFA Advantage Purchase program offers buyers access to conventional mortgages with 30-year terms.

Features

  • 30-year mortgage
  • Fixed interest rates
  • Only 3% down payment required
  • No mortgage insurance required
  • Borrowers have access to conventional, uninsured mortgages through Fannie Mae or Freddie Mac

Eligibility

  • Minimum credit score of 680 for scored applicants
    • Borrowers with no scored credit allowed if accepted by Fannie Mae or Freddie Mac
  • Statewide income limit: $115,600
  • Maximum loan limit: $484,350 or limit set by Fannie Mae or Freddie Mac, whichever is lower
  • Homebuyer education course required
  • Buyers must contribute at least $1,000
    • The $1,000 payment may be a gift
  • Property requirements
    • May be one-unit, single-family, attached or detached home
    • May be a condominium, permanent manufactured housing or planned unit development
    • Must be owner-occupied
    • All borrowers must occupy the residence
    • Applicant may hold ownership interest in one separate residential property
  • Cosigners not allowed
  • Buydowns not allowed

How it works

Those interested in the CHFA Advantage Purchase program should begin the process by taking the CHFA webinar and a homebuyer education course. Learn more about how to begin the process with an online or in-person class here.

CHFA Preferred

The CHFA Preferred program provides homebuyers access to conventional, 30-year mortgages through Fannie Mae and Freddie Mac.

Features

  • 30-year mortgage
  • Fixed interest rates
  • Low mortgage insurance rates
  • Borrowers have access to conventional, uninsured mortgages through Fannie Mae or Freddie Mac
  • Program is exempt from recapture tax
  • Non-repayable grant offered up to 4% of initial mortgage total OR second mortgage available up to 5% of initial mortgage
    • Funds may be applied toward closing costs, down payment or prepaid expenses

Eligibility

  • Mid credit score of 620 or higher for scored applicants
    • Borrowers with no scored credit allowed if accepted by Fannie Mae or Freddie Mac
  • Statewide income limit: $115,600
  • Maximum loan limit: $484,350 or limit set by Fannie Mae or Freddie Mac, whichever is lower
  • Maximum loan-to-value (LTV) 97% and combined LTV 105% except:
      • Maximum LTV 95% and combined LTV 105% for manufactured homes (Fannie Mae only)
    • Combined LTV 105% (Fannie Mae only)
  • Homebuyer education course required
  • Buyers must contribute at least $1,000
    • The $1,000 payment may be a gift
  • Property requirements
    • May be one-unit, single-family, attached or detached home
    • May be a condominium, permanent manufactured housing or planned unit development
    • Must be owner-occupied
    • All borrowers must occupy the residence
  • Cosigners not allowed
  • Buydowns not allowed
  • Must have private mortgage insurance on any loan more than 80%

How it works

Anyone interested in the CHFA Preferred program can learn more by taking an online or in-person homebuyer education course.

CHFA Section 8

Features

  • 30-year mortgage
  • Fixed interest rates
  • Borrowers have access to conventional, uninsured mortgages through Fannie Mae or Freddie Mac
  • Non-repayable grant offers up to 4% of initial mortgage total OR second mortgage available up to 5% of initial mortgage
    • Funds may be applied toward closing costs, down payment or prepaid expenses
  • Exempt from recapture tax

Eligibility

  • Must be a first-time homebuyer, qualified military veteran or not have been a homeowner for three years prior to the date of mortgage execution
  • Mid credit score of 620 or higher for scored applicants
    • Borrowers with no scored credit allowed if accepted by Fannie Mae or Freddie Mac
  • Statewide income limit: $115,600
  • Maximum loan limit: $484,350 or limit set by Fannie Mae or Freddie Mac, whichever is lower
  • Homebuyer education course required
  • Borrowers must contribute $500 if ACH payments are chosen or $750 if ACH payments are not chosen
    • This $500 or $750 contribution may be a gift
  • Property requirements
    • May be one-unit, single-family, attached or detached home
    • May be a condominium, permanent manufactured housing or planned unit development
    • Must be owner-occupied
    • All borrowers must occupy the residence
    • Applicant may hold ownership interest in one separate residential property
  • Cosigners not allowed
  • Buydowns not allowed

How it works

All potential homebuyers wishing to participate in the CHFA Section 8 program should begin by checking to see whether they are approved by the public housing authority to take part in the mortgage program. Borrowers will also have to take part in an online or in-person homebuyer education course. Find out more here.

CHFA HomeAccess

Features

  • 30-year mortgage
  • Fixed interest rates
  • Second mortgage available up to $25,000 at 0% interest rate
    • This second mortgage has a maximum loan term of 485 months
    • Payments deferred until after first mortgage has been paid
    • Starting at month 361, $200 payments will be due each month
    • Loan funds may be applied toward closing costs, down payment or prepaid expenses
  • CHFA HomeAccess loan may be subject to the recapture tax
    • If so, CHFA will reimburse borrowers after the successful sale of the property

Eligibility

  • Must be a first-time homebuyer, qualified military veteran or not have been a homeowner for three years prior to the date of mortgage execution
  • The borrower or the child of the borrower must have a permanent disability, determined by the Social Security Administration
  • Mid credit score of 620 or higher for scored applicants
    • Borrowers with no scored credit allowed if accepted by FHA or USDA-RD
  • Income limits differ by county and household size
    • Income limits range from $33,000-$43,400 for a one- to two-person household
    • Income limits range from $49,400-$65,100 for a three-plus-person household
  • Maximum loan limits vary by county and range from $271,000 to $453,100
    • The statewide maximum is $453,100 or limit set by Fannie Mae or Freddie Mac, whichever is lower
  • Homebuyer education course required
  • Buyers must contribute at least $500 if opting into ACH payments and $750 if not
    • These payments may be a gift
  • Property requirements
    • May be one-unit, single-family, attached or detached home
    • May be a condominium, permanent manufactured housing or planned unit development
    • Must be owner-occupied
    • All borrowers must occupy the residence
  • Cosigners not allowed
  • Buydowns not allowed

How it works

If you’re interested in learning more about how to buy a home using the CHFA HomeAccess program, begin by taking a homebuyer education class online or in person. Find courses here.

CHFA SmartStep

Features

  • 30-year mortgage
  • Fixed interest rates
  • Non-repayable grant offers up to 4% of initial mortgage total OR second mortgage available up to 5% of initial mortgage
    • 0% silent second mortgage
    • No monthly payments required
    • No accrued interest
    • The second mortgage must be fully paid during a refinance, when selling the home or if the property is no longer the applicant’s primary residence
  • Grant or second mortgage funds may be applied toward closing costs, down payment or prepaid expenses
  • Temporary buydowns may be allowed when in adherence to VA, FHA or USDA-RD rules

Eligibility

  • Mid credit score of 620 or higher for scored applicants
    • Borrowers with no scored credit allowed if accepted by VA, FHA or USDA-RD
  • Statewide income limit is $115,600
  • Maximum statewide loan limit is $484,350 or the total as set out by the VA, FHA or USDA-RD, whichever amount is lower
  • Homebuyer education course required
  • Buyers must contribute at least $1,000
    • The $1,000 payment may be a gift
  • Property requirements
    • May be one-unit, single-family, attached or detached home
    • May be a condominium, permanent manufactured housing or planned unit development
    • Must be owner-occupied
    • All borrowers must occupy the residence
    • Applicant may hold ownership interest in one separate residential property
    • Applicant allowed a maximum of one CHFA-financed residence at a time
  • Cosigners not allowed

How it works

To take part in the CHFA SmartStep program, you’ll have to complete a homebuyer education course online or in person. Find a class here.

CHFA HomeOpener

Features

  • 30-year mortgage
  • Fixed interest rates
  • Non-repayable grant offers up to 4% of initial mortgage total OR second mortgage available up to 5% of initial mortgage
    • No monthly payments, no accrued interest, 0% silent second loan
    • The second mortgage must be fully paid at the time of a sale, move or refinance
  • Grant or second mortgage funds may be applied toward closing costs, down payment or prepaid expenses
    • Temporary buydowns may be allowed
      • To qualify, applicants must be approved at the note rate, rather than the buydown rate

Eligibility

  • Mid credit score of 620 or higher for scored applicants
  • Homebuyer education course required
  • Buyers must contribute at least $1,000
    • The $1,000 payment may be a gift
  • Maximum loan limit is $453,100 or the total set out by the VA, FHA or RD, whichever is lower
  • Income limits vary by county
    • Income limits range from $94,900-$124,800 for a one- to two-person household
    • Income limits range from $107,300-$141,100 for a three-plus-person household
  • Property requirements
    • May be one-unit, single-family, attached or detached home
    • May be a condominium, permanent manufactured housing or planned unit development
    • Must be owner-occupied
    • All borrowers must occupy the residence
    • Applicant may hold ownership interest in one separate residential property
    • Applicant allowed a maximum of one CHFA-financed property at a time
  • Cosigners not allowed

How it works

To qualify for any CHFA loan, you’ll have to complete a homebuyer education course online or in person. Find one here.

National first-time homebuyer programs

In addition to loan programs offered through the state of Colorado, first-time homebuyers may also be eligible for a host of federal loan programs. Find out more about FHA loans, HUD DollarHomes, VA loans and more by checking out our guide to national first-time homebuyer programs.

 

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