First-Time Homebuyer Programs Worth Applying For in 2026

The program you are searching for is almost always two programs. One is a first mortgage that sets your down payment floor: FHA, VA, USDA or conventional. The other is a pot of down payment assistance from a state agency, a city, or a national provider that covers some or all of that floor. You apply for both through the same lender at the same time, and in most cases the assistance cannot be bolted on after you are already under contract.

This page is for buyers who have not owned a principal residence in the past three years, which is how the great majority of programs define "first-time" (The Mortgage Reports' 2026 grant guide). If you served, stop reading the assistance sections until you have checked your VA entitlement, because that route changes the maths more than any grant will.

The thing most people get wrong: there is no federal first-time homebuyer tax credit. As of September 2026 nothing has been enacted. The $15,000 First-Time Homebuyer Tax Credit Act (H.R.4717 and S.2402) was introduced on July 23, 2025 and sat in the Ways and Means and Finance committees without a floor vote, according to the congressional record. The MAHA Act, introduced January 28, 2026 by Rep. Tom Kean Jr. and Rep. Ryan Mackenzie, would give up to $5,000 for single filers and $10,000 for joint filers, and it is in committee too. Buyers who are holding off until a credit passes are waiting on a bill that has not moved in over a year.

Layer one is the mortgage. It decides your minimum down payment, your loan ceiling, and whether assistance can sit behind it as a second lien.

FHA is the default for buyers with thin savings and mid-range credit, and it requires 3.5% down, the figure the national assistance programs are built around (Chenoa Fund program pages, 2026). HUD set the 2026 FHA limit for a one-unit home at a floor of $541,287, up from $524,225 in 2025, with a ceiling of $1,249,125 in high-cost counties, effective for case numbers assigned on or after January 1, 2026.

VA is better than anything else on this page if you qualify. Since the Blue Water Navy Vietnam Veterans Act took effect in January 2020, veterans with full entitlement face no VA-imposed loan limit at all, provided they can afford the payment and the appraisal supports the price, per VA.gov. National Guard and Reserve eligibility runs through Title 32 activation criteria alongside the standard 90-day active-duty path.

USDA's Single Family Housing loans require no down payment, but two gates close fast: household income generally must be at or below 115% of area median income, and the property must sit in an eligible area, generally one with 10,000 residents or fewer. Places with 10,001 to 20,000 residents can qualify if they are outside a Metropolitan Statistical Area, and some areas up to 35,000 residents remain eligible under grandfathering rules, according to USDA Rural Development.

Conventional loans are governed by the conforming limit, which FHFA set at $832,750 for one-unit properties in 2026, up 3.26% from $806,500, with a high-cost ceiling of $1,249,125. If you are weighing conventional against FHA, the deciding factors are usually credit score and mortgage insurance rather than the limit; our breakdown of FHA and conventional loans sets those side by side.

Layer two is the assistance. Between 2,000 and 2,500 down payment assistance programs operate nationwide through state housing finance agencies, local governments and nonprofits, in four structures: outright grants, repayable second mortgages, deferred loans due at sale or refinance, and forgivable loans written off over 5 to 20 years of occupancy (The Mortgage Reports' DPA guide, updated January 5, 2026). Typical awards run $5,000 to $25,000, with some programs capped at 6% of the purchase price. Louisiana's program reaches $55,000 and New York City's HomeFirst reaches $100,000, both outliers.

Two national networks cover the gap when your state's funds run dry or you miss its income test.

Chenoa Fund, run by CBC Mortgage Agency (NMLS #1186381), operates in every state except New York and provides 3.5% or 5% of the purchase price as a second mortgage. Its official program page sets a minimum credit score of 600 using the lowest middle score on the loan, and states there are no income limits and no strict first-time-buyer requirement. There are three FHA-compatible products: Rate Advantage, DPA Edge (a soft second at 0% with no payment, forgiven after 36 consecutive on-time mortgage payments), and Edge Repayable Second (a 10-year note at 0% or a 30-year note at a rate up to 2% above your first mortgage). The conventional Fannie Mae version is currently on hold. The DPA Edge products carry a 115% AMI income limit and a 45% DTI ceiling, and The Mortgage Reports puts the FHA-paired minimum FICO at 620. Chenoa also includes 18 months of post-purchase counseling through Money Management International.

National Homebuyers Fund, a nonprofit founded in 2002, gives up to 5% of the loan amount, around $17,500 on a $350,000 mortgage, either as a grant that is never repaid or as a 0% second forgiven in full after three years of continuous occupancy. It requires a 640 FICO and a DTI at or below 45%, works with conventional, FHA, VA and USDA loans, and does not require first-time status. NHF has distributed more than $517 million to roughly 57,900 buyers since 2002.

Access to Chenoa widened this year. On April 22, 2026 the National Association of Mortgage Brokers announced a partnership with the fund, giving member brokers expanded access plus training on program guidelines and structuring, HousingWire reported.

Do these in sequence. Skipping to step 7 is how buyers end up with a lender who cannot deliver the program they were counting on.

1. Confirm the three-year rule applies to you. Check whose name has been on a deed for a principal residence, including a spouse's. Worked when there is nothing in the past three years, which puts you inside the eligibility window for state programs and the first-time-only tier of many local ones. Costs nothing but the time it takes to remember.

2. Pull your middle score, your DTI and your income percentage on the same afternoon. These three numbers decide which of the programs below will even talk to you. Worked when you can say, out loud: middle score, DTI, and income as a share of your area's median. If your score lands between 600 and 640, you are inside Chenoa's range but outside NHF's and outside most state minimums, which narrows your choices sharply.

3. Test the address on USDA's eligibility lookup tool. Rural Development launched a new tool in April 2026, integrated into its property and income eligibility site. Worked when you get a yes or no for a specific address rather than a general area. Worth doing even for suburban addresses: eligibility maps follow population thresholds, not intuition, and they are re-evaluated roughly every five years.

4. Pick the first mortgage and check your county's limit. FHA's 2026 floor is $541,287 and its ceiling $1,249,125; the conventional conforming limit is $832,750 rising to $1,249,125 in high-cost areas. FHFA reported limits rose in all but 32 U.S. counties for 2026. Worked when your target price sits under the limit for your actual county, not your state.

5. Go to your state housing finance agency before you go anywhere national. State money is usually cheaper, often a 0% deferred or forgivable second, and it stacks on top of FHA, VA, USDA and conventional first mortgages. Local city and county programs frequently sit on top of that again. If you want a shortcut into what your state offers, the state-by-state loan matchmaker is built for that comparison. Worked when you have a program name, an award amount, and its current funding status in writing.

6. Line up a national fallback. Call Chenoa Fund at 866-563-3507 for a list of approved correspondent lenders, or NHF at 866-643-4968 for participating lenders. Worked when you have at least one lender name that is approved for the specific product you want. Note that Chenoa is unavailable in New York.

7. Apply through a lender approved for that program, and get pre-approved. Assistance funds only move through approved or participating lenders, so the order matters: the program picks the lender, not the other way round. What the lender looks at, and what you need to hand over, is set out in our walkthrough of what pre-approval involves. Worked when your pre-approval letter names the assistance program, not just the loan amount.

8. Complete the homebuyer education course early. Nearly every DPA program requires it, and underwriting will stall without the certificate. Chenoa borrowers below certain credit score thresholds get counseling free through Money Management International, with support running 18 months after purchase.

9. Get the assistance terms in writing before you sign anything. Ask which of the four structures you have, and write down the answer: grant, deferred, forgivable, or repayable. Then ask for the forgiveness clock. Chenoa's DPA Edge forgives after 36 consecutive on-time payments; NHF's forgivable second clears after three years of continuous occupancy; state forgivables typically run 5 to 20 years.

Treating a repayable second as a grant. Chenoa's Edge Repayable Second is a real note: 10 years at 0%, or 30 years at a rate up to 2% above your first mortgage. How to spot it: your closing disclosure lists a second lien with a monthly payment. What to do: ask your loan officer to name the product, Rate Advantage, DPA Edge, or Edge Repayable, and to show you the payment schedule before you commit.

Applying with a lender who cannot deliver the program. Assistance flows only through approved correspondent or participating lenders. How to spot it: the loan officer talks about "down payment help" without naming a program, or says they will "look into it." What to do: get the approved lender list from the source, not from a search engine.

Reading "no income limits" as applying to every product. Chenoa's official page says no income limits, and that is true of the program overall, but DPA Edge is capped at 115% of AMI and the conventional Fannie Mae version is currently suspended. How to spot it: you were quoted a conventional structure and the file goes quiet. What to do: confirm in writing which specific product your income and loan type qualify for.

Moving or refinancing inside the forgiveness clock. Leave before 36 months on a Chenoa soft second, or inside three years on an NHF forgivable, and the balance is still owed. Good Neighbor Next Door carries a 36-month residency requirement of its own. How to spot it: you are house hunting with a job change, deployment or relocation on the horizon. What to do: if you expect to move inside three years, take a grant structure or nothing.

Waiting for the tax credit. Homebuyer.com's tracker, updated August 28, 2026, notes that the $15,000 bill has picked up dozens of co-sponsors and no floor action in over 13 months, and that only about 4% of bills become law. Better's rundown of the three competing proposals puts the estimated cost of these credits in the hundreds of billions over a decade, which is the stated reason none has moved. How to spot it: you are timing a purchase around legislation. What to do: buy on your own numbers, or wait for a reason that is about your finances.

Missing the county limit by shopping on the state figure. FHA's floor and ceiling differ by more than $700,000 depending on where you are. How to spot it: your agent is showing you homes priced above the local FHA ceiling. What to do: check the limit for your county before the first showing, not after the offer.

New York. Chenoa Fund is available in every state except New York, so the national fallback in step 6 does not exist for you. NHF still does, and New York City's HomeFirst program runs up to $100,000 in assistance, the highest local figure in The Mortgage Reports' January 2026 survey.

Alaska, Hawaii, Guam and the U.S. Virgin Islands. FHFA set the 2026 baseline for these areas at $1,249,125 with a ceiling of $1,873,675, and HUD applies special higher FHA limits for construction costs.

High-cost counties. Limits are calculated at 115% of local median home value, capped at 150% of the baseline. That produces the $1,249,125 ceiling for both FHA and conventional one-unit loans in 2026.

Veterans with partial entitlement. If you already have a VA loan outstanding or had a prior default, county limits come back into play: $832,750 in most counties and $1,249,125 in high-cost counties such as Honolulu, New York and San Francisco. Separately, the VA Partial Claim Program launched June 15, 2026 as a foreclosure-prevention tool, with a required three-month trial payment plan; servicers must have it fully implemented by November 28, 2026 and it is authorized through July 30, 2030. That matters after closing, not before.

Teachers, police officers, firefighters and EMTs. Good Neighbor Next Door sells eligible HUD homes at 50% off list price in exchange for a 36-month residency commitment. It is the largest single discount on this page and the narrowest in who it fits.

Repeat buyers. Both NHF and Chenoa drop the first-time requirement, which makes them the obvious place to look if you owned a home within the past three years and your state program has ruled you out.

Closing near a year boundary. The 2026 FHA limits apply to case numbers assigned on or after January 1, 2026, while the conventional limits apply to loans delivered or pooled on or after that date. If you are closing near the turn of a year, the date your case number is assigned decides which limit governs your file.

Tax year 2026 specifically. The federal deduction for the VA funding fee was revived for tax year 2026 after lapsing since 2021, and Better reports that the One Big Beautiful Bill Act reinstated the PMI and MIP deduction starting in 2026. Neither is a first-time buyer credit, and neither reduces what you need at the closing table.

On an FHA purchase, 3.5% assistance is not a discount on the house. It is the difference between buying this year and saving for another two. That is the honest framing: these programs move your timeline, not your price.

What it costs you depends entirely on structure. A grant costs nothing. A forgivable second costs you mobility for the length of the clock. A repayable second costs a monthly payment on top of your mortgage, at 0% over 10 years or at up to 2% above your first mortgage rate over 30. CBC Mortgage Agency has recently lowered rates on its DPA second mortgages, its first such reduction in recent history, and has added temporary rate buydowns combined with assistance.

One more structural option worth naming: Fannie Mae's Community Seconds and Freddie Mac's Affordable Seconds allow subordinate financing up to 105% combined loan-to-value, which is the mechanism that lets many state programs layer behind a conventional first mortgage at all.

We are not printing a mortgage rate on this page. None of the sources used here publishes a dated rate for September 2026, and a rate quoted in an article is stale within a week. Get same-day quotes from two or three lenders that are approved for your assistance program, and compare the total, first mortgage plus second, rather than the headline rate.