Colorado First-Time Home Buyer: 2021 Programs & Grants

Peter Warden
The Mortgage Reports editor

What to know about buying a house in Colorado

Buying your first home is exciting — but it can be a little intimidating, too.

The good news is, first-time home buyers in Colorado have access to tons of support to help them through the home buying process.

That ranges from advice and home buyer education programs, to cold hard cash in the form of loans or grants that could pay your upfront costs. Explore your options to see what you qualify for.

Verify your home buying eligibility in CO (Jul 31st, 2021)

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Colorado home buyer overview

According to the Colorado Association of REALTORS, the median home price in the state topped $500,000 in April 2021. That represented a 19.5% price gain year over year.

At $502,000, the Centennial State’s prices are roughly 1.5 times higher than the national average. So it’s just as well there’s plenty of support for a first-time home buyer in Colorado.

Colorado Home Buyer Overview
Average Home Sale Price $502,000
Minimum Down Payment in Colorado (3%) $15,060
20% Down Payment in Colorado $100,400
Average Credit Score in Colorado1 725
Maximum Colorado Home Buyer Grant2 5% of loan amount in El Paso county only / 3% statewide

Down payment amounts are based on the state’s most recently available average home sale price. “Minimum” down payment assumes 3% down on a conventional mortgage with a minimum credit score of 620.

If you’re eligible for a VA loan (backed by the Department of Veterans Affairs) or a USDA loan (backed by the US Department of Agriculture), you may not need any down payment at all.

Verify your home buying eligibility in CO (Jul 31st, 2021)

First-time home buyer loan programs in Colorado

If you’re a first-time buyer in Colorado with a 20% down payment, you can get a conventional loan — likely with a low interest rate and no private mortgage insurance (PMI).

Putting 20% down will keep your monthly mortgage payments low. It might also give you an edge in competitive housing markets like Denver or Boulder.

However, few first-time borrowers have saved that much.

The good news is, there’s a wide range of mortgage loan options that can help buyers get into a new house with low or even no down payment:

  • Conventional 97 — Backed by Freddie Mac or Fannie Mae. 3% down payment and 620 minimum credit score. You can usually stop paying mortgage insurance after a few years
  • FHA loan — Backed by the Federal Housing Administration. 3.5% down and a 580 minimum credit score. You’re on the hook for mortgage insurance until you refinance to a different type of mortgage, move home, or pay off your loan
  • VA loan — Only for veterans and service members. Zero down payment is required. Minimum credit score varies by lender but often 620. No ongoing mortgage insurance after closing. These are arguably the best mortgages available, so check your eligibility if you have a military service history
  • USDA loan — For those on low-to-moderate incomes buying in designated rural areas. Zero down payment is required. Credit score requirements vary by lender but often 640. Low mortgage insurance rates
  • CHAC and CFHA mortgage loans — Assisted mortgage programs offered statewide and locally. More info below

Remember, your down payment isn’t the only upfront cost when buying a house. You also need to cover closing costs, which often total 2-5% of the home loan amount.

Down payment and closing cost assistance programs — discussed below — can help first-time buyers cover their upfront fees.

Also keep in mind that your mortgage payments will include property taxes and homeowners insurance on top of loan principal and interest. So factor these homeownership costs in when estimating your home buying budget.

Colorado first-time home buyer assistance programs

There are a variety of statewide and local programs to help first-time home buyers in Colorado make an affordable home purchase.


The Colorado Housing and Finance Authority (CHFA) operates statewide and provides education and down payment assistance.

The CHFA firststep and firststep plus programs are open to those who want FHA loans (mortgages backed by the Federal Housing Administration) with fixed rates and 30-year terms.

You’ll normally need a credit score of 620, though you may find a CHFA-approved lender that will accept 580. You also have to have a low or moderate income for your area.


The Colorado Housing Assistance Corporation (CHAC) is another official statewide body providing all sorts of advice, education, and assistance to any first-time homebuyer in Colorado who asks.

In addition to down payment assistance, CHAC offers education courses and counseling.

Its courses come in two flavors: eHomeAmerica ($99 for the first borrower and $49 for each co-borrower) and Framework ($75). Both are currently available online and most elements have versions in Spanish.

To qualify for assistance from CHAC, you will need to have a household income that’s no higher than 80% of the area median income (AMI) where you want to buy. However, that can be 100% or 115% in Arvada.

You can call (303) 572-9445 or toll-free on (866) 377-7835 to see if you’re eligible.


Besides CHAC, you may also be able to get assistance from the Community Resources and Housing Development Corporation (CRHDC) NeighborhoodLIFT program. This is available to buyers in Adams, Arapahoe, Denver, Douglas, and Jefferson Counties.

NeighborhoodLIFT offers home buyer education programs as well as preferential help for first responders, military service members, and teachers. Income caps are less restrictive for those who qualify.

Check your first-time home buyer eligibility (Jul 31st, 2021)

Colorado first-time home buyer grants

Down payment assistance programs (DPA) can provide grants and loans to help buyers cover their out-of-pocket expenses. That includes the down payment and closing costs.

These programs are often meant to help low-income home buyers, and many have income caps based on household size.

DPA programs and eligibility requirements vary by area, so check with your mortgage lender or real estate agent to see what’s available locally.


CHFA can deliver down payment assistance grants (that never have to be repaid) as well as loans. You could receive 3% of your mortgage amount as a grant.

So, for example, if you’re borrowing $400,000, you might receive up to $12,000 toward your down payment and/or upfront fees.

If that’s not enough, you can bump that up to 4% of your mortgage amount. But this is in the form of a second mortgage loan rather than a grant.

You’d have to repay that loan in full when you sell, refinance, or finally pay off your first mortgage. Other actions may also trigger repayment in full. Still, you don’t have to make any monthly payments in the meantime.


CHAC doesn’t seem to offer grants, only loans. And it doesn’t specify the maximum amount it will lend home buyers, nor the interest rate it charges. But its website does say:

“The loan is recorded as a second mortgage (lien) on the property being purchased. All of the loans require repayment, usually with monthly payments, although the start date of those payments may vary.”

It adds, “All borrowers are required to have a minimum contribution of $1,000 (minimum contribution for the disability program is $750.00) to the transaction that cannot be a gift. Exceptions may apply.”


The NeighborhoodLIFT program can provide $15,000 of down payment assistance on qualified properties. Remember, that’s only in Adams, Arapahoe, Denver, Douglas or Jefferson County.

You can download PDFs showing income limits and a map showing the areas covered. Eligible properties include a single-family detached home, townhouse, condominium, 1-4 unit property, or planned unit development (PUD).

CHFA, CHAC, and NeighborhoodLIFT all require applicants to take a home buyer education class. But most first-time home buyers in Colorado or elsewhere should welcome all the knowledge they can absorb.

Check your first-time home buyer eligibility (Jul 31st, 2021)

Buying a home in Colorado’s major cities  

Buying a home in or around one of Colorado’s major cities can be a little more challenging than buying in a suburb or rural area. So you’ll want to know what to expect.

Denver first-time home buyers

The median listing price in Denver was $525,000 in May 2021, according to That was 9.6% higher than a year earlier.

If you want to buy a home at that price, your down payment might fall between:

  • $15,750 for a 3% down payment
  • $105,000 for a 20% down payment

Denver’s Department of Housing Stability (HOST) offers down payment assistance of up to $15,000. This seems to be part of the CHAC program, because interested parties are referred to it.

However, its website does provide Denver-specific household income caps: “The program is limited to households earning up to 80 percent of the area median income (up to $52,000 for a single-person household, or up to $66,850 for a three-person household).”

Note that availability and income caps may have been updated by the time you read this.

Colorado Springs first-time home buyers

The median listing price in Colorado Springs was $390,000 in May 2021, according to That represented an increase of 12.7% year-over-year.

If you want to buy a $390,000 home, your down payment options might be:

  • $11,700 for a 3% down payment
  • $78,000 for a 20% down payment

Those buying in Colorado Springs may be in line for the El Paso County “Turnkey Plus” mortgage program. That offers “soft loans,” with a 0% interest rate and no monthly payments. And you can borrow 4% or 5% of your new mortgage’s value.

Half your DPA loan is forgiven over the first five years of your mortgage. But the other half remains repayable for the full 30 years and is only forgiven when you make your last payment on your mortgage.

Meanwhile, if you sell, refinance, or trigger other conditions, you’ll have to repay your loan balance in full at that time.

Aurora first-time home buyers

The median listing price in Aurora was $410,000 in May 2021, according to That represented an increase of 10.8% year-over-year.

If you wish to buy a $410,000 home, your down payment options range between:

  • $12,300 for a 3% down payment
  • $82,000 for a 20% down payment

Aurora’s Home Ownership Assistance Program (HOAP) offers loans of up to $10,000 or the minimum down payment required for your mortgage, whichever is the less. And you must chip in at least 1% of the home’s purchase price from your own funds.

This is another “silent” loan, meaning you don’t make monthly payments or pay interest. However, none of it is forgivable. And you have to pay back the entire amount when you sell the home, when it is no longer your primary residence, or when you refinance with cash out.

Where to find home buying help in Colorado

All the organizations we’ve listed above should provide advice freely to any first-time home buyer in Colorado.

In addition to our selection, the US Department of Housing and Urban Development (HUD) provides a list of city- and county-specific programs across Colorado which you can see here.

What are today’s mortgage rates in Colorado?

You can see current mortgage rates in Colorado here.

When you’re ready to buy, make sure you get rate quotes from at least 3 mortgage lenders. This will ensure you’re getting the lowest interest rate and fees available to you.

If you opt to work with one of the Colorado first-time home buyer programs listed above, you’ll receive a list of participating lenders to pick from. However, you can still shop around for your best mortgage rate within each list.

If you’re going the traditional route — without down payment assistance — you can check rates from any mainstream lender.

Shopping around for your best mortgage loan could save you thousands.

Verify your new rate (Jul 31st, 2021)

1 Source: 2021 study of 2020 data

2Based on a review of the state’s available DPA grants at the time this was written