What Is Down Payment Assistance (DPA)?
Down Payment Assistance (DPA): Grants or low-cost loans from state and local programs that help buyers with a down payment.
Also called: DPA
Down payment assistance (DPA) programs help buyers, often first-time buyers or those under income limits, cover a down payment and closing costs.
Common types
- Grants: don't need to be repaid
- Forgivable second loans: forgiven after you live in the home a set number of years
- Deferred second loans: repaid when you sell, refinance or pay off the first mortgage
- Low-interest second loans: repaid monthly alongside the first mortgage
Who offers it
State housing finance agencies, cities and counties, nonprofits and some employers. Rules usually include income limits, purchase price caps, a homebuyer education course and living in the home.
Good to know
DPA can be paired with conventional, FHA, VA and USDA loans, but not every lender participates in every program. Ask early, because some programs have limited funds and add time to closing.