Colorado’s largest statewide down payment assistance (DPA) program comes from the Colorado Housing and Finance Authority (CHFA). It offers a grant of up to 3% of your first mortgage (max $25,000) that never has to be repaid, or a 0% deferred second mortgage of up to 4% (max $25,000) that’s repaid when you sell, refinance or pay off the home.
Along the Front Range, metroDPA offers a 0% deferred second mortgage with no first-time buyer requirement and an income limit of $210,150. Most programs require a credit score of 620 or higher, a homebuyer education class and a small contribution of your own money. But DPA isn’t free money. It usually comes with a higher rate and higher fees than a standard loan, so read Jenn’s insider take below before you decide.
Key takeaways
- CHFA is the statewide option. A grant of up to 3% or a 0% deferred second of up to 4%, both capped at $25,000.
- metroDPA covers the Front Range. No first-time buyer requirement and a $210,150 income limit.
- Local programs can go bigger. Prop 123, Colorado Roots and Boulder programs offer more in specific areas.
- Most programs need 620+ credit. Plus a homebuyer class and a small contribution of your own.
- Assistance has a cost. Compare a Loan Estimate with DPA to one without before you choose.
Colorado down payment assistance programs compared
Figures are current as of September 2026. Programs change, so confirm current terms before applying.
CHFA’s FirstGeneration and HomeAccess programs (for first-generation buyers and buyers with permanent disabilities) allow the full $25,000 regardless of the first mortgage amount.
What is down payment assistance?
Down payment assistance is money from a housing agency, city, county or nonprofit that reduces the cash you need at closing. Depending on the program, it can cover your down payment, closing costs and prepaids. It usually comes in one of three forms:
- Grant: you never repay it.
- Deferred second mortgage: no monthly payment; repaid when you sell, refinance or pay off the home.
- Low-interest second mortgage: repaid monthly, usually at a below-market rate.
How does CHFA down payment assistance work?
CHFA assistance is paired with a CHFA first mortgage (FHA, VA, USDA or conventional) and is available only through CHFA-approved lenders. For the grant or the second mortgage, you’ll need:
- A 620 minimum mid-credit score (exceptions may apply if you have no credit score)
- A $1,000 minimum financial investment of your own, in addition to any other required closing costs or down payment. Gift funds may count.
- A CHFA-approved homebuyer education class, completed before closing (free in-person and online options are available)
- The home to be your primary residence
- Household income and purchase price within CHFA limits for your county and program
Grant funds can be used for down payment, closing costs and prepaids. They can’t be used to pay off your debts or fund a repair escrow.
CHFA grant vs. CHFA second mortgage: which is better?
On a $400,000 first mortgage, the grant provides up to $12,000 and the second mortgage up to $16,000. The trade-off:
- Choose the grant if you might sell or refinance within a few years. There’s nothing to pay back.
- Choose the second mortgage if you need the extra 1% and plan to stay put. The full balance comes due when you sell or refinance.
CHFA notes that higher interest rates apply when you use its DPA options. Before deciding, compare the total cost of each option against a loan with no assistance. You can check today’s rates to start.
metroDPA: Front Range help with no first-time buyer rule
metroDPA, sponsored by the City and County of Denver and participating Front Range communities, offers a 0% interest, 30-year deferred second mortgage with no scheduled payments. There’s no first-time homebuyer requirement, so repeat buyers are eligible. The income limit is $210,150, with added benefits for conventional-loan borrowers below 80% of area median income. Homebuyer education is required, and the minimum credit score is 620 (640 in some cases).
Prop 123: Colorado’s newer state-funded assistance
Voters approved Proposition 123 in 2022, and part of that funding goes to down payment assistance through the Colorado Department of Local Affairs (DOLA). You don’t apply to the state directly. The money flows through participating local governments and nonprofits, which lend to buyers earning up to 120% of area median income. Loans can be as large as 20% of the home’s cost, but they’re non-forgivable, and the home carries a 5-year affordability period. Availability depends on whether your city or county is participating, so ask before you count on it.
How much income can you make and still qualify?
No single income limit applies statewide. Limits depend on:
- Household size
- County
- Whether the property is in a targeted area (limits may be higher)
- The loan program and type of assistance
metroDPA’s $210,150 cap is one of the higher limits in the state. If you’re over one program’s limit, you may still qualify for another.
Can you combine down payment assistance programs?
Sometimes, but not freely. CHFA assistance requires a CHFA first mortgage and metroDPA requires its own first mortgage, so buyers usually choose one or the other. Some local and nonprofit programs can be layered on top, but every source of funds has its own rules and has to be approved together. Ask your loan officer to confirm this before you make an offer.
Common mistakes that delay DPA closings
- Waiting to take the homebuyer class. Take it as soon as you start looking. A missing certificate can hold up closing.
- Not documenting your own funds. Keep your $1,000 contribution in a bank account with a clear paper trail.
- Assuming “income” means your pay stub. Program income limits can be calculated differently than the income a lender uses to qualify you.
- Shopping above the purchase price limit. Know your program’s limit for the county before you tour homes.
What to do before you apply
- Check your credit score. Most programs need 620 or higher.
- List your monthly debts.
- Confirm how much cash you have, including any gift funds.
- Gather two years of income and employment history.
- Narrow down the counties where you want to buy.
- Sign up for a homebuyer education class.
No one gets a free lunch
Here’s what I’ll say about down payment assistance programs, and it’s about the opposite of what you see online, where people are peddling these programs. They do it because everyone wants to know how they can buy a home without any skin in the game. Well, I’m here to tell you: that is extremely rare.
These programs aren’t a scam, but they sound too good to be true, because they are. No one gets a free lunch. The fees and costs that cover any assistance get built into your mortgage, through higher closing costs, extra fees or a higher interest rate than you’d normally get. That’s the part they don’t tell you until it’s too late.
Compare before you commit
You don’t have to wait until you’ve saved 20% to buy in Colorado, and DPA is only one way to get there. Blue Arrow Lending can show you what a loan without assistance would cost, including low-down-payment options like FHA and conventional loans. Put that next to any DPA offer and compare the real numbers. Have a question first? Contact our team.
Sources: CHFA: Down Payment Assistance · CHFA: Homeownership FAQs · metroDPA · City and County of Denver: metroDPA · Colorado DOLA: Down Payment Assistance (Prop 123) · City of Boulder: Guide to Down Payment Assistance Programs
Program availability, income limits, purchase price limits, loan terms and eligibility requirements change and are set by each program sponsor.
Frequently Asked Questions
Through CHFA, up to 3% of your first mortgage as a grant or up to 4% as a deferred second mortgage, capped at $25,000. Some local programs offer more, including Colorado Roots (up to $50,000) and Boulder’s H2O loan (up to $100,000) in their service areas.
Not always. metroDPA has no first-time buyer requirement, and CHFA’s DPA options don’t list one either. Some local programs do require it, and each program defines “first-time buyer” in its own way.
It depends on the program. The CHFA grant never has to be repaid. The CHFA second mortgage and metroDPA are 0% deferred loans with no monthly payment, repaid when you sell, refinance or stop living in the home.
CHFA requires a 620 minimum mid-credit score for all borrowers, with possible exceptions for borrowers who have no credit score. metroDPA also starts at 620, and 640 in some cases.
Yes. CHFA and metroDPA both work with FHA, VA, USDA and conventional first mortgages, subject to each program’s guidelines. Both also require a homebuyer education class before closing.
Broker/Owner of Blue Arrow Lending with 13 years of experience originating mortgages. Jenn helps borrowers in Colorado, Florida, Texas, and Wyoming compare down payment assistance with a standard loan before they decide.
This article is for general educational purposes only and is not a commitment to lend. Loan program requirements, down payment minimums, and mortgage insurance rules are general guidelines and are subject to change. All loans are subject to credit approval, underwriting, and property eligibility. Blue Arrow Lending, NMLS# 2046633. Jenn Moretti, NMLS# 573143. Licensed in Colorado, Florida, Texas, and Wyoming. Equal Housing Opportunity.