CHFA recognizes that saving enough money to pay the down payment is the main barrier to homeownership for many first-time homebuyers. If you have the monthly income to pay mortgage payments, but not enough money to pay the upfront costs, you may qualify for a low-interest loan to help you cover the down payment and closing costs. Borrowers can finance the down payment and closing costs with a DAP loan. A DAP loan is a second mortgage on your home. In most cases, the interest rate on a DAP loan will be the same as the interest rate on your CHFA first mortgage.
- Financing to cover down payment and closing costs
- Home purchase assistance up to $20,000
- Low-interest rate second mortgage
- You must first apply and qualify for a CHFA mortgage from a CHFA-Approved Lender.
- You will be required to use any applicant's household savings above $10,000 towards your down payment and closing costs – excluding your retirement accounts. CHFA will waive this requirement for qualified Police Officers and Teachers Program loans.
- You will be required to make a minimum contribution of $1,000 toward the acquisition costs.
- An eligible borrower must show his or her ability to repay the CHFA first mortgage and the DAP loan in order to qualify for assistance under this program.
- Your DAP loan must be at least $3,000, but no more than the minimum down payment required for your home, usually between 3% and 3.50%. Your lender will work with you to determine the amount of down payment required for your mortgage loan and verify your ability to repay both your first mortgage and the DAP loan.
- You will be required to attend a free Homebuyer Education class prior to closing. The class will help you understand the home-buying process and offer tips for maintaining a home. Classes are held online and at locations across Connecticut.
Your city or town may offer down payment assistance in the form of low-interest loans or grants. Be sure to inquire with your local Department of Economic and Community Development. Some employers also offer grants or loans, so check with your benefits office.
How to Apply
Contact a CHFA-Approved Lender near you and apply! For additional questions, you may contact the CHFA Single Family Department at (860) 571-3502 or email firstname.lastname@example.org