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About the CHFA Down Payment Assistance Grant
The CHFA Down Payment Assistance Grant gives Colorado buyers up to 3% of their first mortgage, capped at $25,000, and none of it is ever paid back. The Colorado Housing and Finance Authority (CHFA) attaches it only to its own first mortgages, as the smaller but repayment-free alternative to its 4% second mortgage loan. The grant can be applied toward a down payment or closing costs, and because it is a true grant, there is no second mortgage, no monthly payment, and no balance owed at sale or refinance.
Every borrower on the loan needs a 620 credit score, and household income is capped by county and family size. Outside targeted areas, CHFA's 2026 cap is $130,400 for one or two people and $149,960 for three or more. Targeted areas have higher limits of $156,480 and $182,560 respectively. Colorado buyers are not required to be first-time homebuyers for the CHFA Down Payment Assistance Grant, which makes it accessible to repeat buyers as well. All borrowers must contribute at least $1,000 of their own funds toward the purchase and complete a CHFA-approved homebuyer education course before closing.
The CHFA Down Payment Assistance Grant provides less total assistance than the CHFA Down Payment Assistance Second Mortgage Loan, which offers up to 4% of the first mortgage amount. However, the grant requires zero repayment under any circumstances, while the second mortgage loan must be repaid when you sell, refinance, or move out. Buyers who plan to sell or refinance within a few years often prefer the grant to avoid future repayment, even though it provides a smaller dollar amount.
How much assistance
Eligibility
- Income limits: Varies by county and household size. Household of 1-2: $130,400 (non-targeted) / $156,480 (targeted). Household of 3+: $149,960 (non-targeted) / $182,560 (targeted). Effective Jan 5, 2026.
- First-time buyer required: No
- Credit score minimum: 620
- Geographic restrictions: Must purchase a primary residence in Colorado. Must pair with a CHFA first mortgage loan program.
- Homebuyer education required: Yes
How to Apply for CHFA Down Payment Assistance Grant
Step 1: Confirm income against your county's limit
Pull up the county table at chfainfo.com/homeownership/income-limits before calling a lender, because the grant's income cap depends on where the home sits. A one or two person household buying outside a targeted area can earn up to $130,400 in 2026, while a family of three or more in a targeted area can earn up to $182,560. Each borrower also needs at least a 620 credit score. Repeat buyers qualify, so owning a home before does not rule you out.
Step 2: Take the CHFA homebuyer class
The grant will not fund until every borrower has finished a homebuyer class CHFA has approved. The cheapest route is a free in-person session from an approved provider, taught in English or Spanish in communities around the state. The self-paced eHome America version at chfainfo.ehomeamerica.org runs $75, takes about six hours, and ends with a follow-up call with the education provider. Finish it early so it does not hold up closing.
Step 3: Pick a lender from CHFA's list
Only lenders approved by CHFA can issue the grant, and Colorado has more than 100 of them. Search chfainfo.com/homeownership/find-a-participating-lender by city or county to find one near the home you want. Ask each lender which CHFA first mortgage they would pair with the grant, since the size of that loan decides how many dollars the 3% works out to.
Step 4: Get pre-approved and select your CHFA first mortgage
The grant cannot attach to an outside loan, so pre-approval means choosing a CHFA first mortgage: FirstStep for FHA, Preferred for conventional, or SmartStep for FHA, VA, or USDA. The lender looks at income, credit, and debts, then sizes that first mortgage. The grant equals 3% of the loan amount, up to $25,000, so a larger first mortgage produces a larger grant.
Step 5: Find a home and make an offer
The home has to be your primary residence in Colorado and fit CHFA's program guidelines. Bring at least $1,000 of your own funds to the deal; a cash gift from a family member can count toward it. Because the grant tops out at 3% and an FHA loan needs 3.5% down, tell your agent how much of that gap you will cover so the offer is written around it.
Step 6: Close on your home
Your lender processes both the first mortgage and the DPA grant together. The grant funds are applied at closing toward your down payment or closing costs. There is no second lien recorded because the assistance is a grant with no repayment obligation. Because nothing is owed later, selling or refinancing down the road never triggers a payoff on the grant.
Real Cost Example
At 3% of the first mortgage, the CHFA Down Payment Assistance Grant pays about $12,767 on a $441,000 Colorado Springs home financed with a $425,565 CHFA FHA loan. FHA's 3.5% minimum on that price is $15,435, so the grant covers most of the down payment but not all of it. The money can be applied to the down payment or to closing costs.
After applying the grant to the $15,435 down payment, you would still need approximately $2,700 out of pocket to cover the remaining down payment, plus your required $1,000 minimum borrower contribution. Estimated closing costs in Colorado Springs run $9,000 to $13,000, which would need to come from savings, seller concessions, or other sources.
Buyers who need more upfront assistance may want to consider the CHFA Down Payment Assistance Second Mortgage Loan, which provides up to 4% of the first mortgage (approximately $17,023 on this same home) and covers the full down payment, though it requires repayment when you sell or refinance.
Combining With Other Programs
The grant exists only as an add-on to a CHFA first mortgage, whether FirstStep, Preferred, or SmartStep, so it cannot sit behind a loan from a lender working outside the CHFA lineup. Importantly, you must choose between the CHFA Down Payment Assistance Grant and the CHFA Down Payment Assistance Second Mortgage Loan. Taking the 3% grant means giving up the 4% loan on that purchase, and the reverse is also true.
The grant can potentially be combined with other non-CHFA assistance sources, such as employer assistance programs, gifts from family members, or federal programs like Federal Home Loan Bank products. The CHAC Down Payment Assistance Program, which provides $5,000 to $12,000 as a deferred loan through the Colorado Housing Assistance Corporation, may also be available to eligible buyers seeking additional help beyond the CHFA grant.
For buyers who qualify as first-generation homebuyers, the CHFA FirstGeneration program offers a separate first mortgage with its own $25,000 DPA included. Because FirstGeneration bundles its own first mortgage and DPA, it operates as a standalone option rather than layering with a standard CHFA first mortgage and this grant.
Pros and Cons
The standout advantage of the CHFA Down Payment Assistance Grant is that it requires absolutely no repayment, making it the only zero-obligation DPA option in the CHFA lineup. Unlike the CHFA Down Payment Assistance Second Mortgage Loan, there is no deferred balance hanging over your property and no surprise repayment when you sell or refinance. The program is also open to repeat buyers, not just first-time homebuyers, which broadens eligibility significantly compared to programs like CHFA FirstGeneration. The 620 minimum credit score is accessible, and income limits of $130,400 to $182,560 depending on household size and area cover a wide range of Colorado buyers.
The tradeoff is a smaller assistance amount. At 3% of the first mortgage, the grant provides roughly $3,000 to $5,000 less than the 4% second mortgage loan option on the same home purchase. For a buyer purchasing at $441,000 in Colorado Springs, that difference is about $4,256. The grant alone may not fully cover the FHA 3.5% minimum down payment, leaving a gap the buyer must fill from savings or other sources. Buyers who need every available dollar toward their down payment and closing costs, and who plan to stay in the home long-term, may find the second mortgage loan option more practical despite the eventual repayment requirement.
Frequently Asked Questions
Do I have to pay back the CHFA Down Payment Assistance Grant?+−
Can I use the CHFA DPA Grant with an FHA loan?+−
Can I combine the CHFA grant with the CHFA second mortgage loan?+−
Do I have to be a first-time homebuyer to get the CHFA DPA Grant?+−
How much does the CHFA DPA Grant actually provide on a typical Colorado home?+−
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Program details last verified: May 12, 2026