Virginia Down Payment Assistance and First-Time Homebuyer Programs

Virginia homes have continued to sell at astonishing prices, with the median home sale price rising by 8.3% year-over-year from $366,500 to $397,000. A scarcity of houses in the state is the primary driver behind this increase. As such, Virginia’s real estate market has become quite volatile, with significant interest rates and mortgage payments, all of which are unlikely to drop anytime soon.

Nonetheless, for prospective homebuyers in Virginia, there’s a possibility for refinancing if these rates do drop. Alternatively, you can also ease the burden of the state’s two-decade-high mortgage increase through downpayment and closing cost assistance, affordable interest rates, and more first-time homebuyer programs.

Looking for assistance in a specific part of Virginia?

This page provides comprehensive details on the aid accessible to homebuyers in Virginia, covering both statewide and local resources. If your focus is solely on down payment assistance in specific cities, local information can be found here:

• Loudoun County
• Hampton Roads Cities
• Henrico County
• Danville
• Chesapeake
• Norfolk
• Arlington County
• Richmond
• Alexandria

Down payment assistance in Virginia

Discovering down payment assistance in Virginia presents an excellent opportunity to enhance affordability in purchasing a home. Beyond conventional loans, prospective buyers can explore FHA, VA, and USDA loan alternatives. Stairs Financial provides valuable details on several affordable housing programs, empowering residents to select the best option for their needs.

Virginia HOMEownership Down Payment Assistance Program

The HOMEownership Down Payment and Closing Cost Assistance Program is an initiative developed to provide flexible gap financing for first-time homebuyers looking to purchase safe, decent, and accessible homes. This program is provided in the form of grants and assists homebuyers at or below 80% of the area median income (AMI).

Assistance type: Grants

Sponsor: VA Department of Housing and Community Development (DHCD)

Assistance amount: Up to 10% or 15% of the sales price, plus about $2,500 for closing costs.

Minimum borrower contribution: 1% of the sales price for income is between 50%-80% of AMI and $500 if income is less than 50%.

Eligibility requirements

• Homebuyers must have never owned a home before or held primary ownership in a principal residence within the most recent three-year period.
• Applicants must have a median credit score of 620 or higher, and the debt-to-income ratio should not exceed 43%.
• Applicants must complete a HUD-certified counseling.

Virginia Housing Down Payment Assistance Grant

The Housing Down Payment Assistance Grant is designed to provide financial aid to help aspiring homebuyers expedite their down payment saving process. As a grant, homeowners never need to make repayment, and this assistance can be paired with other non-Virginia housing assistance.

Assistance type: Deferred Payment Loans

Sponsor: Virginia Housing

Eligibility requirements:

• Applicants must be qualified first-time homebuyers or repeat buyers purchasing in Areas of Economic Opportunity.
• Applicants must have a bond FHA/ Conventional loan from Virginia Housing.
• Applicants must have a household income within Virginia Housing’s income limits.

Loudoun County Down Payment Assistance Program

Loudoun County is known for its beautiful scenery, rich history, and a healthy diversity of expanding opportunities. This dynamic county houses over 400,000 people, all of whom can benefit from the county’s rapid growth, comfortable neighborhoods, and top-notch public services.

First-time homebuyers in Loudoun County can take advantage of the Down Payment/ Closing Cost (DPCC) Assistance Program to get affordable housing in the county. This program aids moderate-income residents looking to purchase an existing market-rate home or get one through the Affordable Dwelling Unit program. 

Assistance type: Deferred Payment Loans

Sponsor: Loudoun County Housing and Community Development

Assistance amount: 10% of the purchase price or $25,000, whichever is less.

Eligibility requirements

• Applicants must be first-time homebuyers and must have lived or worked in Loudoun County for at least six months.
• Applicant’s gross annual household income must fall within 30% to 70% of the Area Median Income.
• The current eligible income range is $46,450 to $108,300, regardless of family size.

Hampton Roads Cities

The Homebuyers Assistance Program provides down payment and closing costs for low to moderate-income families in some of the Hampton Roads cities. Eligible service areas include Chesapeake, Isle of Wight County, James City County, Gloucester, Williamsburg, York County, Poquoson, and Portsmouth.

Assistance type: Deferred Conditional Grant

Sponsor: Hampton Roads Planning District Commission (HRPDC)

Assistance amount: Assistance amount differs based on the city.

Minimum borrower contribution: 1% of the sales price.

Eligibility requirements

• Eligible applicants must fall within the annual gross household income
• Applicants must complete an in-person or online first-time homebuyer course offered through Virginia Housing.
• The property must be the homebuyer’s principal residence for a certain period.

Henrico County Home Purchase Assistance Program

One of the oldest counties in the country, Henrico County, houses about 332,120 people and offers the best suburban lifestyles with urban amenities. Henrico has a diverse economy with opportunities in various sectors, including healthcare, education, finance, and real estate.

Henrico County offers the Employee Home Purchase Assistance Program (EHPAP) to eligible County employees to purchase a home within the county. This assistance provides an interest-free forgivable loan that goes into downpayment and closing costs.

Assistance type: Forgivable Loans

Sponsor: Henrico County.

Assistance amount: Up to $25,000 in down payment and closing cost assistance.

Purchase price limit: $500,000

Minimum borrower contribution: $1,000

Eligibility requirements

• The program is available to full-time permanent employees of government and public school employees, and constitutional officers.
• Employees must have at least 12 months of continuous full-time service and a performance appraisal of acceptable or better.
• Applicants are required to participate in homebuyer education and counseling.

Danville Homeownership Assistance

The City of Danville offers some of the best living conditions for its 42,229 population. The city’s cost of living is 17% lower than the national average, and, more astonishing, the median home value is 58% lower than the national average. The city also ranks high on diversity, creating a rich cultural environment.

The City of Danville aims to create more diverse homeowners through several assistance programs, including the Down Payment Assistance. This DPA program assists low and moderate-income residents to get a house anywhere within the city by providing up to 50 per cent of the requirement down payment.

Assistance type: Deferred Payment Loans

Sponsor: City of Danville

Assistance amount: Up to 50% of the required down payment.

Eligibility requirements

• The property must meet HOME Quality Standards as determined by a City inspector.
• All eligible applicants are required to complete a first-time homebuyer’s counseling program.

City of Chesapeake HOME Program

Chesapeake offers a unique blend of rural and urban centers, providing citizens with excellent schools, recreational facilities, and strong leadership. The area also receives high scores in housing due to its affordability ratios, making it a popular city to call home.

The Call Chesapeake HOME Down Payment and Closing Cost (DPCC) Program offers qualified first-time homebuyers with closing cost and downpayment assistance. This program aims to increase homeownership and housing affordability for low and moderate-income families within Chesapeake.

Assistance type: Grant

Sponsor: City of Chesapeake

Assistance amount: Up to $25,000 for downpayment and closing costs.

Minimum borrower contribution: 1% of the sales price

Eligibility requirements

• Applicants must be first-time homebuyers.
• The property must be purchased within the City of Chesapeake.
• Applicants must provide a certificate from an in-person VHDA-approved First-time Homebuyer Class.

Norfolk Down Payment Assistance Program

Norfolk is considered an independent city with a population of 238,005 as of the 2020 census. The city provides a great living climate for all residents through a wealth of amenities, excellent public transit accessibility, high-rated schools, quality social facilities, and affordable housing.

The City of Norfolk provides eligible participants in target neighborhoods with financial assistance through the Strengthening Neighborhood Program. This assistance goes into owner-occupied rehabilitation, rental property rehabilitation, and downpayment assistance to first-time homebuyers. The two target neighborhoods include Ingleside and Oakdale Farms/ Monticello Village.

Assistance type: Deferred Payment Loans

Sponsor: The City of Norfolk

Assistance amount: Up to $40,000 in downpayment and closing cost assistance.

Minimum borrower contribution: 1% of the sales price.

Eligibility requirements

• This program is reserved for households with income between 80 and 120 percent AMI.
• Applicants must not have owned a home within the past three years.
• Applicants must not have filed for bankruptcy in the last two years.

Arlington County Homeownership Assistance Program

Arlington is a vibrant and dynamic county located in Northern Virginia and sitting just across the Potomac River from the national capital. Arlington has a population of 237,300 people and is ranked as one of the wealthiest counties, with a median household income of over $125,000. However, this status results in high housing costs.

First-time homebuyers looking to purchase a home in Arlington can take advantage of the Moderate-Income Purchase Assistance Program (MIPAP) to cover a portion of the downpayment and all closing costs. This program serves as a second mortgage, with the first mortgage being a conventional loan from a VHDA-approved lender.

Assistance type: Deferred Payment Loans

Sponsor: Arlington County

Assistance amount: Up to 25% of the home purchase price or $112,500, whichever is less.

Purchase price limit: $500,000

Minimum borrower contribution: $1,000

Eligibility requirements

• The property must be located in Arlington County.
• Eligible properties include single-family properties and condominiums.
• Eligible applicants must have a debt-to-income ratio of 45%

Richmond Down Payment Assistance Program

The capital of Virginia, Richmond, is known for its historical significance in the American Revolution and Civil War. With a population of about 226,610, Richmond is Virginia’s fourth most populous city and a major economic hub with sectors like finance, government, education, and healthcare.

The City of Richmond invests in homeless prevention and shelter, affordable housing, and neighborhood revitalization through specific federally funded programs, including the Down Payment Assistance Program. This program provides decent, affordable housing to low-income first-time homebuyers in Richmond.

Assistance type: Forgivable Loans

Sponsor: The City of Richmond

Assistance amount: Up to $15,000 for downpayment and closing cost assistance.

Eligibility requirements

• Applicants must be first-time homebuyers.
• Eligible applicants must have at least $30,000 in combined annual income.
• This program is reserved for low-income households with income under 80 percent of the AMI.

Alexandria Homeownership Assistance Program

Alexandria, located in the northeastern tip of the Northern Virginia region, is a captivating city with a rich history and vibrant present. The city’s proximity to Washington makes it home to professionals working in federal service, the military, and private companies serving the government.

The City of Alexandria’s Office of Housing provides a range of services to homebuyers, including the Closing Costs and Downpayment Assistance. This program provides no-interest deferred payment loans to homebuyers purchasing a home through the Affordable Set-Aside Homebuyer Program, Neighborhood Stabilization Program, or the Resale Restricted Homeownership Program. Income-eligible employees can also explore the Employee Homeownership Incentive Program.

Assistance type: Deferred Payment Loans

Sponsor: Alexandria Office of Housing.

Assistance amount: Up to $50,000.

Minimum borrower contribution: $2,000 or $3,000 of required settlement.

Eligibility requirements

• Eligible applicants must have resided and/ or worked within the corporate limits of the City of Alexandria for at least six months prior to application.
• Applicants must be first-time homebuyers with no current ownership of real estate.
• Applicants should have incomes at or below the applicable limits in place for the property being marketed.

Virginia down payment assistance program FAQs

Here are some common questions from first-time homebuyers in Virginia seeking assistance with down payments.

Does Virginia have a first-time buyer program?

Yes, Virginia offers several first-time homebuyer programs, from the statewide HOMEownership Down Payment Assistance and Virginia Housing Down Payment Assistance Grants to local assistance programs in Henrico County, Norfolk, and Loudoun County.

How to buy a house for the first time in Virginia?

It’s easy to understand the requirements for buying a house for the first time through a homebuyer education class. You should also be familiar with your finances, including your credit score and yearly income. With this information, you can use Stairs Financial to identify down payment assistance that you qualify for and connect with appropriate lenders.

What is the minimum down payment in Virginia?

The minimum down payment depends on the loan. Typically, it’s 3% for conventional loans, 3.5% for FHA loans, and 0% for VA and USDA loans.

Can you get Biden first-time home buyer assistance in Virginia?

Yes, you can get Biden first-time home buyer assistance in Virginia once the bill is passed into law. The Biden $25,000 Down Payment Toward Equity Act of 2021 and Biden’s First-Time Homebuyer Tax Credit are all federal programs, so they will be available in all states, including Virginia when passed into law.

What type of Virginia first-time homebuyer assistance is available?

Most first-time homebuyer assistance programs in Virginia are in the form of grants and loans. However, these loans are forgiven or deferred when specific criteria are satisfied, like when the buyer sells the house.

What is the Virginia first-time homebuyer income limit?

The income limit for down payment assistance for first-time homebuyers in Virginia is 80% of each city’s median income (AMI). However, it may also rise to 120% for some programs and drop to 30 in others; hence, you should always check the program requirements.

What are some requirements for first-time home buyers in Virginia?

Some standard requirements for first-time homebuyers in Virginia include;

• Applicants must earn at least $25,000 in annual income; plus, there’s also an income limit depending on the household
• Applicants should have a minimum credit score of 620.
• Buyers must complete a homebuyer education course.

How do I qualify for Virginia first-time home buyer programs?

Aside from not owning a home in the last three years, the primary qualifying criterion for these programs is the deal’s financials, including credit score, household income, and purchase price limit.

Disclaimer: This article is for informational purposes only and should not be considered as legal or financial advice. Please consult an attorney, mortgage lender, or CPA for guidance on your specific situation.