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Colorado First-Time Home Buyer Programs of 2020

March 19, 2020
Finding the Right Mortgage, Mortgages
colorado-first-time-home-buyer-programs
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NerdWallet is not affiliated with the Colorado Housing Finance Authority (CHFA) in any way. CHFA does not endorse or affirm the information on this page, including programs, rates or lender ratings. Availability and details of CHFA’s programs are subject to change at any time.

It’s tough to be a first-time home buyer in Colorado these days. With home prices soaring and houses selling quickly, it may feel like your dream of becoming a homeowner is out of reach.

But as a Colorado first-time home buyer, you may have more options than you think. State and national loan programs can make homeownership accessible and affordable, if you know where to find them.

Learn more about first-time home buyer programs available nationwide and from the Colorado Housing and Finance Agency, or CHFA, and how they can benefit you.

National first-time home buyer programs

These national loan programs, which aren’t restricted to first-time home buyers, make it possible to get a mortgage with low credit scores or a limited down payment.

Conventional mortgage

National program

Best for

Low down payment

Limited mortgage insurance premiums

What you need to know

First-time home buyers can get a conventional home loan with as little as 3% down if the mortgage meets requirements set by Fannie Mae and Freddie Mac. And if you put at least 20% down, you won’t have to pay mortgage insurance. Most lenders require a minimum credit score of 620 to qualify for a

 

FHA loans

National program

Best for

Low credit score

Low down payment

What you need to know

This is the go-to program for many first-time home buyers with lower credit scores. The Federal Housing Administration allows down payments as low as 3.5% for those with credit scores of 580 or higher. The FHA will insure loans for borrowers with scores as low as 500 but requires a 10% down payment

 

VA loans

National program

Best for

Military

Low down payment

What you need to know

Guaranteed by the U.S. Department of Veterans Affairs, these mortgages are available to military members, veterans and surviving spouses. If you qualify, you’ll see benefits such as no minimum credit score and no down payment or mortgage insurance, but you'll likely have to pay a VA funding fee.

 

USDA loans

National program

Best for

Low down payment

Rural

What you need to know

A USDA home loan is a zero-down-payment mortgage for eligible rural and suburban home buyers. USDA loans are issued by the U.S. Department of Agriculture through the USDA Rural Development Guaranteed Housing Loan Program. There are income limitations, which vary by region. Applicants with credit

 

» MORE: Tips for first-time home buyers

CHFA first-time home buyer loan programs

Using a network of participating mortgage lenders across the state, CHFA offers purchase loans, as well as down payment and closing cost assistance.

Program availability and eligibility requirements vary; contact a CHFA participating lender to learn more about which programs could suit your situation.

CHFA highlights and eligibility requirements

Highlights

  • Purchase loan programs available.
  • Down payment and closing cost assistance for purchases.
  • Home buyer education offered in English and Spanish.

Eligibility

  • Have a 620 minimum credit score.
  • Complete an in-person or online CHFA home buyer education course.
  • Meet income limits, which vary by location and household size.
  • Make a minimum financial contribution of at least $1,000.
  • Meet the qualification requirements of a CHFA participating lender.

CHFA mortgage programs

State program

Review CHFA Lenders

at NerdWallet

Best for

Low down payment

Government-backed loans

What you need to know

CHFA encourages responsible, affordable homeownership by offering programs for first-time home buyers. CHFA's loan programs include conventional loans, USDA loans, VA loans and FHA loans. Eligible borrowers can combine CHFA mortgages with down payment and closing cost assistance programs.

 

CHFA down payment assistance grant

State program

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Best for

Down payment assistance

Closing cost assistance

What you need to know

With this program, you can get up to 3% of your CHFA 30-year mortgage amount for a down payment grant — repayment isn’t required.

 

CHFA down payment second mortgage loan

State program

Review CHFA Lenders

at NerdWallet

Best for

Down payment assistance

Closing cost assistance

What you need to know

This program provides up to 4% of your CHFA mortgage amount for a down payment. The second mortgage needs to be repaid, but not until you sell, refinance or completely pay off the first mortgage.

Your next step

Looking for help buying a home in Colorado? Start by finding a CHFA participating lender to determine your eligibility and apply.

You may also want to assess your credit, figure out how much house you can afford and enroll in a Colorado first-time home buyer education class. CHFA makes these available for free in-person or online for a fee, and taking a class will help you make home buying decisions with confidence, no matter which loan option you choose.

» MORE:  See NerdWallet’s top Colorado mortgage lenders

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