Washington First-Time Home Buyer: 2024 Programs and Grants

By: Peter Warden Updated By: Ryan Tronier
June 17, 2024 - 11 min read

What to know about buying a house in Washington

If you’re a Washington first-time home buyer, you can face some hurdles.

But take heart. The Evergreen State offers extensive support, ranging from free homebuyer education to special mortgages. And, if you’re eligible, you could be in line for cash assistance toward your down payment and closing costs. Here’s how to get started.

Verify your home buying eligibility in Washington. Start here

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Washington home buyer overview

In May 2024, the median list price in Washington state reached $658,500, according to Redfin. This increased 6.6% from the previous year.

For many first-time homebuyers in Washington state, the challenge is navigating a market with low inventory and high prices. Aspiring homeowners, however, should not give up hope just yet. You could get into a home sooner than you think if you qualify for one of the many homeownership programs available.

Verify your home buying eligibility in Washington. Start here

Washington home buyer stats

Average Home Listing Price in WA1$658,500
Minimum Down Payment in WA (3%)$19,755
20% Down Payment in WA$131,700
Average Credit Score in WA2735
Maximum WA Home Buyer Grant/Loan3$90,000 loan in Seattle only

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 U.S. Department of Agriculture), you may not need any down payment at all.

First-time home buyer loans in Washington

If you’re a first–time home buyer in Washington state with a 20% down payment, you can get a conventional loan with a low interest rate and no private mortgage insurance (PMI).

Find the best first-time home buyer loan for you. Start here

Of course, few first-time buyers have saved up enough money for a 20% down payment. But the good news is that you don’t need that much. Not by a long shot. Borrowers can often get into a new home with as little as 3% or even 0% down using one of these low-down-payment mortgage programs:

  • Conventional 97: From Freddie Mac or Fannie Mae. 3% down payment and 620 minimum FICO score. You can usually stop paying mortgage insurance after a few years once you reach 20% home equity
  • FHA loan: Backed by the Federal Housing Administration. 3.5% down and a 580 minimum credit score. But you’re on the hook for mortgage insurance premiums (MIP) until you refinance to a different type of mortgage, move home, or pay off your loan
  • VA loan: Only for veterans and active-duty 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 apply if you’re eligible
  • USDA loan: For those on low–to–moderate incomes buying in designated rural areas. Zero down payment required. Credit score requirements vary by lender but often 640. Low mortgage insurance rates
  • WSHFC loans: May include competitive interest rates and down payment assistance. More information below

Note that government loan programs (including FHA, VA, and USDA home loans) require you to buy a primary residence. That means you can’t use these loans for a vacation home or investment property.

In addition, most programs let you use gifted money or down payment assistance (DPA) to cover your down payment and closing costs. Depending on your mortgage loan, you could potentially get into a new house with minimal cash out of pocket.

If you’re unsure which program to choose for your first mortgage, your lender can help you find the right match based on your finances and home buying goals.

Washington first-time home buyer programs

The Washington State Housing Finance Commission (WSHFC) has two main mortgage programs. They are called Home Advantage and House Key Opportunity. Both programs may provide first-time homebuyers with preferential interest rates and down payment assistance.

Verify your home buying eligibility in Washington. Start here

WSHFC Home Advantage

Washington first-time homebuyers may be able to qualify for a reduced interest rate with the help of the Home Advantage program. The specifications are quite simple:

  • Minimum credit score: 620
  • Maximum debt-to-income (DTI) ratio of 50%
  • Annual earnings under $180,000

WSHFC House Key Opportunity

The House Key Opportunity program is intended for homebuyers with lower incomes who are also utilizing particular down payment aid programs. Depending on where you wish to buy and the size of your household, the income thresholds range from $100,000 to $175,000.

You can’t spend more than a certain amount on the home you want to buy, which can be anywhere from $345,000 to $750,000 depending on where it is.

The benefit of House Key Opportunity is a competitive interest rate, which is cheaper on FHA, VA, and USDA loans, similar to Home Advantage. If your income is below 80% of the area median income (AMI) for a conventional loan, you may be eligible for an interest rate discount.

WSHFC EnergySpark

If you are eligible for the Home Advantage program, you may want to think about purchasing a home that is eco-friendly or one that can be remodeled to satisfy Washington’s green requirements. That’s because you might be able to benefit from the EnergySpark program, which offers additional interest rate savings.

Property prerequisites:

  • It must be a brand-new home that meets the requirements for NEEM/Energy Star, LEED, or Built Green certification
  • The house must already exist and is capable of being upgraded to save 10% more energy than it now consumes

WSHFC loan requirements

WSHFC mortgage programs can be used with FHA, VA, USDA, and conforming loans. Here’s what you can expect.

  • Meet median household income limits and home purchase price limits.
  • Credit score requirement of 640 or better. But you may get away with one as low as 620 if your debt-to-income ratio is low
  • Complete an approved homebuyer education course to be eligible. You can attend a free virtual online seminar or pay $50 for an online self-study course.
  • As is usual with state-run mortgage programs, you’ll have to choose a WSHFC-approved lender

Assuming you clear those hurdles, you should be able to get a WSHFC mortgage and a down payment assistance loan to go with it.

If you have questions about the Home Advantage Program, call (800) 767-4663 or email info@heretohome.org. For more information about the House Key Opportunity program, contact a participating lender.

Washington first-time home buyer grants

Washington offers a variety of down payment assistance programs, which is excellent news for first-time homebuyers. In fact, the WSHFC reports that the typical home buyer receives $10,000 in down payment assistance from the organization.

The sheer range of offerings could make your choice difficult. So, follow the WSHFC’s advice and consult with one of its approved lenders to narrow your options.

Let us help find the right mortgage for you

The following assistance programs are all loans that must be repaid when you sell, refinance, or finish paying off your house. To be eligible, you must have a credit score of at least 620 and meet the income requirements for the program. If you’re not a first-time home buyer but are buying in a designated targeted area, you might still be eligible.

Home Advantage Down Payment Assistance (DPA)

This down payment loan can contribute up to 4% of the total amount of your mortgage when combined with a Home Advantage first mortgage. That loan amount increases to 5% if you’re taking out a conventional HFA Preferred loan.

It’s a no-interest loan with payments deferred for 30 years. And there are special programs for some areas where home prices are high. For example, you can borrow up to $55,000 in Seattle.

Home Advantage DPA Needs Based

This program, which is used in conjunction with a Home Advantage first mortgage, is intended for homebuyers who earn much less than the $145,000 income limit. If your yearly income is under $105,300 ($134,600 in King or Snohomish counties), you may qualify for a loan of up to $10,000 for your down payment requirements. The loan carries a 1% interest rate with a 30-year payment deferral period.

Opportunity DPA

Together with the House Key Opportunity first mortgage, this down payment aid program creates a second mortgage of up to $15,000 with a 1% interest rate and 30-year deferred payments. The income restrictions are significantly lower and depend on household size and location.

Veterans DPA

Veterans may also be eligible for up to $10,000 in down payment assistance that’s structured as a second mortgage. Mortgage payments are deferred for 30 years at a 3% interest rate. Either the Home Advantage or House Key Opportunity first mortgage may be paired with this assistance.

HomeChoice Disability DPA

You may be eligible for up to $15,000 in down payment help if you or a member of your household has a disability. This is a second mortgage with deferred payments for 30 years at a 1% interest rate.

If the WSHFC’s homebuyer assistance programs do not suit you, you may have other options. Talk to your loan officer or real estate agent about local down payment grants and loans.

Buying a home in Washington’s major cities

Seattle has the highest home prices among the three largest cities in the Evergreen State, though home prices in both Spokane and Tacoma are growing significantly faster.

Verify your home buying eligibility in Washington. Start here

If you intend to buy in one of these cities, you should look into local DPA programs. So read on.

Seattle first-time home buyers

The median list price for a home in Seattle was $800,000 in May 2024, according to Realtor.com. This fell 5.9% year-over-year.

If you want to purchase a home at this median price, your options for a down payment may include:

  • $24,000 for 3% down payment
  • $160,000 for 20% down payment

The City of Seattle’s Office of Housing has a DPA program for first-time buyers with low incomes. Those who qualify and want to buy a home with three or more bedrooms can get up to $90,000, or $70,000 for fewer bedrooms. Another loan cap of $55,000 applies to certain types of loans.

However, the program’s specifics are not made clear. So, call the Office of Housing at (206) 684-0721 for more information. Or ask your loan officer for details.

Spokane first-time home buyers

The median list price for a home in Spokane was $470,000 in May 2024, according to Realtor.com. This grew 6.6% year-over-year.

If you want to buy a home at that median price, your down payment options could be anything from:

  • $14,100 for 3% down payment
  • $94,000 for 20% down payment

We couldn’t find any evidence of a DPA program specific to Spokane. Spokane Neighborhood Action Partners (SNAP) says that its “Pre-Purchase Counseling and Homebuyer’s Education Seminars will discuss a number of down payment assistance programs that are available to home buyers and identify how much you may be eligible for (subject to mortgage loan program criteria and specific income restrictions).”

So if you’re interested in becoming a homeowner, contact a housing counselor at (509) 456-SNAP.

Let us help find the right mortgage for your first home in Spokane. Start here

Tacoma first-time home buyers

The median list price of homes in Tacoma was $500,000 in May 2024, according to Realtor.com. That increased 3% year-over-year.

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

  • $15,000 for 3% down payment
  • $100,000 for 20% down payment

The City of Tacoma’s down payment assistance program combines with the Washington State Housing Finance Commission’s Home Advantage first mortgage loan program. If eligible, you can borrow up to $30,000 at a simple interest rate of 2% with payments deferred for 30 years. That’s pretty good.

You don’t have to make any monthly payments. You simply repay what you borrowed (plus the interest due) when you move, sell, refinance, or pay off your mortgage balance.

Where to find home buying help in Washington

All the organizations we’ve listed above should provide free advice to any first–time home buyer in the state of Washington or within their areas.

Verify your home buying eligibility in Washington. Start here

In addition to our selection, the U.S. Department of Housing and Urban Development (HUD) provides a few lists for statewide, regional, and local resources.

First-time home buyer resources in Western Washington

First-time home buyer resources in Eastern Washington

What are today’s mortgage rates in Washington?

You can see today’s live mortgage rates in Washington here.

When you’re ready to begin the home-buying process, use a mortgage calculator to see how different down payments and interest rates will affect your monthly mortgage payment. Then, get customized rate quotes from at least three to five mortgage lenders.

Also, don’t just look at advertised rates on the internet. Apply for preapproval and compare the interest rates and fees offered to you. That is the only way to ensure you get the best deal on your new home loan.

Time to make a move? Let us find the right mortgage for you

1Source: Redfin.com Washington Housing Market report

2Source: Experian.com study of 2022 and 2021 data

3Based on a review of the state's available DPA grants at the time this was written

Peter Warden
Authored By: Peter Warden
The Mortgage Reports Editor
Peter Warden has been writing for a decade about mortgages, personal finance, credit cards, and insurance. His work has appeared across a wide range of media. He lives in a small town with his partner of 25 years.
Ryan Tronier
Updated By: Ryan Tronier
The Mortgage Reports Editor
Ryan Tronier is a personal finance writer and editor. His work has been published on NBC, ABC, USATODAY, Yahoo Finance, MSN Money, and more. Ryan is the former managing editor of the finance website Sapling, as well as the former personal finance editor at Slickdeals.