Want to become a homeowner, but don’t have enough cash for a down payment? A state or local down payment assistance program can help! 

Many states, counties, and cities offer grants and no-interest loans to help homebuyers cover down payments and closing costs.

Down payment assistance programs are offered through state-run housing finance agencies, nonprofits, and employers. These programs are often combined with mortgage plans suited to first-time homebuyers.

Closing costs and types of down payment assistance vary by program. Typical forms of service include:

• Grants: Some programs provide a free monetary gift.
• Zero-interest, forgivable loans: Loans are forgiven over a certain period, such as five years. The money doesn't have to be repaid if the borrower still owns and lives in the home after the period is over
• Zero-interest, deferred-payment loans: Generally, no-down-payment and closing-costs payments are due until either the home is sold, the mortgage is refinanced, or the mortgage reaches the end of its term.
• Low-interest loans: Loans must be repaid over a certain period, such as 10 years. They make homeownership more attainable by spreading down payment and closing costs over multiple years.

Most down payment assistance programs are geared toward first-time homebuyers. However, 38% of homeownership programs are open to eligible repeat buyers. 

Our company tracks over 2,000 such programs, including those offering down payment or closing cost assistance.

Even if programs have first-time buyer requirements, don't discount yourself just because you've previously owned a home. A first-time buyer is typically defined as someone who hasn't owned a home for the past three years.

Some local programs are geared toward select groups, such as teachers, police officers, emergency responders, or city employees.

Requirements for down payment assistance programs vary, but typically you must:

• First, take a homebuyer education course.
• Meet the income limits. Since many programs are geared to low- and moderate-income residents, a borrower's household income must be below a certain threshold.
• Purchase in an approved location.
• Stay below the maximum home purchase price, usually a percentage of an area's median home purchase price.
• Contribute some of your own money toward the purchase.

Some places you can check for programs include:

Your state housing-finance authority. Visit NerdWallet's first-time buyer programs page and select your state for a description of their programs right where you live.

• Your city and county governments. Many offer down payment assistance and other programs to boost homeownership.
• The U.S. Department of Housing and Urban Development. Visit the local homebuying programs page on HUD's website and select your state to see a list of programs.
• HUD-approved housing counselors. The Consumer Financial Protection Bureau has a tool to find a housing counselor in your area.
• Down Payment Resource. The company’s website allows you to find homebuyer programs in your area – just fill in your contact information via its online form.

Visit the website of your local government agency or program-administering organization to learn about down payment assistance requirements and find approved mortgage lenders.

Apply for a mortgage with an approved lender to enter the grant program. Local agencies may recommend loan officers experienced in helping people apply for their grants.