Mother and young son sitting together on their couch.

Why they matter: Down payment assistance programs

Down payment assistance programs provide a possible solution to help homebuyers who need financial support. 

With a shortage of affordable housing in communities across the United States, it is more important than ever that we help low-income homebuyers learn about and take advantage of down payment assistance programs and the support they provide.  

How do down payment assistance programs work? 

Programs to assist with down payments on a home are administered by local or state housing agencies, nonprofits and private-sector lenders. Their funding sources include formula grants provided by the HOME Investment Partnerships Program, state-appropriated funds, bond measures, direct local allocations and the Community Development Block Grant program. Many of these programs prioritize first-time homeowners, and some are even set up to help specific groups such as veterans, active service members and teachers. 

Down payment assistance programs can be structured in a number of ways: 

Many families across the U.S. struggle to save enough for a down payment on a home. The tight housing market exacerbates the struggle, driving up prices on single-family homes and putting them even more out of reach for low- to moderate-income families. For many households, particularly lower-income families and people of color who have been historically excluded from the housing market, down payment assistance programs help to make homebuying more affordable and can reduce the racial wealth divide.  

Family of six hugging in front of their home.

Habitat in action 

In 2016, Habitat for Humanity of Washington, D.C., and its partners in the Coalition for Nonprofit Housing and Economic Development worked together to grow the city’s Home Purchase Assistance Program. This program helps low- to moderate-income households achieve homeownership by providing down payment assistance for qualified applicants purchasing single-family houses, condominiums or cooperative units.