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2022 New York First-Time Homebuyer Programs

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The state of New York offers first-time homebuyers assistance in affording their first home, with several generous down payment assistance programs that offer forgivable loans. You may need to live in your home for 10 years to enjoy the full benefit, however. In this article, we’ll go over some of New York’s most common first-time homebuyer programs and how you can qualify.

New York statewide and local first-time homebuyer programs

The State of New York Mortgage Agency offers several different down payment assistance programs that help first-time homebuyers achieve homeownership. Some of the programs below must be used in combination with a SONYMA first mortgage, and programs are also available only to first-time buyers in most cases.

Program nameAssistance amountAssistance typeWhere it’s available
Down Payment Assistance Loan3% of purchase price, up to $15,000Forgivable loanStatewide
Down Payment Assistance Loan PLUSAs much as 20% of purchase price, up to $30,000Forgivable loanStatewide
Neighborhood Revitalization ProgramUp to $20,000Forgivable loanStatewide
Federal Home Loan Bank of New York Homebuyer Dream ProgramUp to $10,000GrantStatewide
HomeFirst Down Payment Assistance ProgramUp to $100,000Forgivable loanOne of the five boroughs in New York City

What to know about different types of down payment assistance

Down payment assistance for first-time homebuyers may come in one of several forms. Here are a few of the more common ones you may come across.

Grants. Grants are free money you don’t need to pay back. Grants for down payment assistance may be structured as a percentage of the sales price or set at a certain amount.

Second mortgage. Some programs offer you a second loan, in addition to your primary mortgage, that you can use for your down payment and closing costs. Loans generally do need to be paid back. Some second mortgage down payment assistance requires you to start paying back the loan in installments right away, while others don’t require any payment until you sell the home. The latter type is often known as a “soft second.” Some second mortgages are 100% forgivable over time.

Forgivable loan. These are a type of second mortgage, but you may not need to pay them back. With a forgivable loan, a portion of the loan amount is reduced for every year you live in the home. After a certain period of time, often five or 10 years, you won’t need to pay back any of the loan. If you decide to sell or move out of the home before that time is up, you’ll need to pay back what’s left on the loan. Most of the New York first-time homebuyer programs we’ve highlighted are structured this way.

How New York first-time homebuyer programs work

To use a first-time homebuyer program in New York, you’ll follow a process not unlike buying a home through traditional means. You might just have a few additional steps to take. Here’s the general process you’ll need to follow.

One note: The process outlined below generally works for the State of New York Mortgage Agency programs. The Federal Home Loan Bank of New York Homebuyer Dream Program is similar, but taking part in New York City’s HomeFirst program is a little different. For that program, you’ll take a course from an approved housing counseling agency and then receive a certificate you can bring to a lender to start the process. You can find a counseling agency near you online here.

Step 1: Take a homebuyer education course

Several of the State of New York Mortgage Agency’s mortgage programs require you to take a homebuyer education course to qualify. These courses may be offered through a U.S. Department of Housing and Urban Development housing counseling agency, though some programs require you to take a course from HomeSmartNY.

Step 2: Choose a lender and get pre-qualified

Most of New York’s first-time homebuyer programs are affiliated with the State of New York Mortgage Agency, which has a network of approved lenders throughout the state who can help you take part in their programs. The SONYMA website has lists of these lenders, broken down by region of the state. It even publishes a list of “Hall of Fame” loan officers who have originated the most SONYMA mortgages.

Once you find a lender that may work well for you, you should get prequalified for a loan. You’ll provide some basic information about your income, assets and debt, and the lender will let you know how large of a loan you may be able to take out and what assistance programs you qualify for.

It may be worthwhile to contact multiple lenders at this stage and get pre-approved with each. This will let you compare different loan offers to find the best interest rates and terms you qualify for. Keep in mind, not all SONYMA lenders offer the agency’s down payment assistance programs. Be sure the lender you choose does at this stage if you’d like to take part.

Similarly, the Federal Home Loan Bank of New York has affiliated lenders that originate the mortgages you’ll need to take part in their programs. You can contact one or several of these lenders to get pre-qualified and find out if you can take part in the grant program.

Step 3: Find your new home

With the pre-qualification in hand, you should have a solid idea about the price range you’re looking for. A real estate agent can help you find homes in this range and put in offers. When you have an offer accepted, you’ll sign a contract committing to buy the home. You may need to make a down payment of as much as 10% of the purchase price to show you’re serious about buying the home. The good news is that SONYMA will finance up to 97% of the price of the home — leaving you with a down payment of just 3% before down payment assistance — and will reimburse you for any amount over that you had to put down at the offer signing.

Step 4: Complete a full loan application

Now that you have a purchase contract, you can move on to the formal loan application. The lender you choose will guide you through the additional steps and documentation you’ll need beyond pre-qualification. At this point, your lender will register the loan with SONYMA and lock in your interest rate. When your lender is finished with your loan application, SONYMA will also review it, which adds about a week to the typical time to close on a loan.

Step 5: Close on the loan

You’ll sign all of the paperwork needed to formally accept your loan and buy the home — then you get the keys. Depending on the type of assistance program you’re in, you may need to live in the home for a certain number of years to enjoy the full benefit. If you don’t, you may need to pay back money you borrowed for your down payment and closing costs.

New York first-time homebuyer program requirements

New York’s programs for first-time homebuyers often do not set specific requirements for credit scores and debt-to-income ratios, instead leaving it to the lenders to decide.

Program name Credit score minimumDTI ratio maximumMaximum income limitHow long you have to live in home
Down Payment Assistance LoanNot disclosed, set by lendersNot disclosed, set by lendersVaries by county, family size and first mortgage program, from $69,680 to $133,61010 years for full loan forgiveness
Down Payment Assistance Loan PLUSNot disclosed, set by lendersNot disclosed, set by lenders60% of area median income10 years for full loan forgiveness
Neighborhood Revitalization ProgramNot disclosed, set by lendersNot disclosed, set by lendersVaries by county and family size; ranges from $69,680 to $145,48010 years for full loan forgiveness
Federal Home Loan Bank of New York Homebuyer Dream ProgramNot disclosed, set by lenders45% in most cases80% of area median incomeFive years
HomeFirst Down Payment Assistance Program620 in most cases; 580 with some FHA loans55%80% of area median income10 years for assistance up to $40,000; 15 years for assistance above $40,000


Many of New York’s first-time homebuyer programs require participants to fall below a certain percentage of their Area Median Income. This is a dollar figure set by the U.S. Department of Housing and Urban Development (HUD), and it varies by county and family size across the country. Generally, a family is considered low-income if they earn between 51% and 80% of the area median income. Below that, the family is “very low income” or “extremely low income.”

You can find your county’s median income using HUD’s lookup tool. You may need to fall below 80% of your county’s area median income to be eligible for down payment assistance programs.

National first-time homebuyer programs

Before you can get down payment assistance in New York, you’ll need to qualify for a first mortgage program to buy your new home. These programs aren’t exclusive to first-time buyers, but have some features that are useful for families buying their first home. Here are a few of the most popular loan programs you’ll likely consider.

Conventional loans. Conventional loans are issued by private lenders and do not fall into any government programs. You may be able to qualify for a conventional loan with a down payment as low as 3%, before assistance. Credit score requirements generally start at 620. You’ll typically need to pay for private mortgage insurance (PMI) if you make a down payment below 20%.

FHA loans. These loans are insured by the Federal Housing Administration and follow the agency’s guidelines. You can typically qualify for an FHA loan with a credit score as low as 500 (if you can make a 10% down payment) or 580 for the lowest down payment of 3.5%. FHA loan guidelines are generally more lenient than those for conventional loans, making them a popular choice for first-time buyers. However, you’ll need to pay mortgage insurance premiums for FHA loans.

VA loans. VA loans are a benefit for military servicemembers and veterans, and offer you the ability to buy a home with no down payment. There is no credit score requirement; lenders are instead required to evaluate your entire financial picture to see if you will be able to repay the loan.

USDA loans. USDA loans are intended to help low- and moderate-income families buy homes in rural areas, and offer you the ability to buy a home with no down payment. You must meet income limits to be eligible.

FAQs about New York’s first-time homebuyer programs

Who qualifies as a first-time homebuyer in New York?

To qualify as a first-time homebuyer, you must not have owned a home in the previous three years, according to the HUD definition. If you only owned a home with a former spouse, you may still qualify.

Can I qualify for down payment assistance in New York?

While requirements can vary by program, you generally need to be a first-time homebuyer with a steady income and good credit to qualify for down payment assistance. You must also commit to living in the home as your primary residence, and will likely need to contribute at least 1% of the purchase price with your own money.

How much of a down payment do I need to buy a house in New York?

Down payment requirements can vary by loan program, but down payment assistance can help you bridge the gap between what the lender requires and the cash you have on hand. Most of New York’s down payment assistance programs still require you to put up at least 1% of the purchase price from your own money.

Home price trends in New York’s major areas

New York City is considered one of America’s most expensive housing markets, though there are plenty of other areas of the state where you can buy a home more affordably. In many counties, the median home price is below $150,000 or $350,000, according to data from the National Association of Realtors.

In the New York City metro area, the median home prices can be as much as $1.2 million (New York County), $674,000 (Queens County), $863,098 (Kings County) or $507,000 (Bronx County). In New York County, this translates to an average mortgage of $4,656 per month. In Queens County, the average mortgage is $2,559, in Kings County, it’s $3,275, and in the Bronx, this would be a mortgage of $1,927. These prices have risen steadily over the past year, prices were up 6.4% in all from the second quarter of 2020 to Q2 2021.


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