How CHFA Down Payment Assistance Works | Colorado Homebuyer Guide
How Does CHFA Down Payment Assistance Actually Work in Colorado?
A Mortgage Tool Bus Guide for Colorado Homebuyers
🚌 Bus Stop #1 — The Two Doors: Grant or Second Mortgage
CHFA doesn’t hand you cash and walk away — the assistance is layered on top of a CHFA first mortgage, and it comes through one of two doors. Walk through the grant door and you get up to the lesser of $25,000 or 3% of your first mortgage, and that money is gone — no repayment, ever. Walk through the second mortgage door instead, and you get more room (up to the lesser of $25,000 or 4%), but it’s a real loan: a 0%-type deferred second that comes due when you sell the home, refinance, or pay off the first mortgage. If at least one borrower is a first-generation homebuyer, or you’re working with CHFA’s HomeAccess program for buyers connected to a permanent disability, that cap opens up to the full $25,000 regardless of your first mortgage size.
You choose one door, not both. Which one makes sense depends on whether you’d rather have less cash to close and truly nothing owed later, or more cash to close with a bill that comes due down the road.
🚌 Bus Stop #2 — Which CHFA First Mortgage Actually Fits You
The down payment assistance rides on top of a CHFA first mortgage, and CHFA runs several — each built for a different situation:
CHFA FirstStep / FirstStep Plus — a 30-year fixed FHA loan for first-time buyers, qualified veterans, or buyers purchasing in a CHFA-designated targeted area.
CHFA FirstGeneration / FirstGeneration Plus — for buyers where at least one borrower is a first-generation homebuyer (an affidavit is required); this is the path to the full $25,000 in assistance regardless of loan size.
CHFA SmartStep / SmartStep Plus — also FHA-based (or VA/USDA), but with no first-time-buyer requirement, so repeat buyers can use it too.
CHFA Preferred / Preferred Plus — a 30-year fixed conventional loan built on the Fannie Mae HFA Preferred structure, with a required minimum $1,000 borrower contribution that can be gifted.
CHFA Schools To Home — built specifically for public school employees. This one works differently from the grant/second-mortgage choice above: it offers its own second mortgage of up to 25% of the first mortgage, paired with a shared-appreciation feature, so it’s worth a dedicated conversation rather than assuming it works like the others.
Right now, I have FirstStep Plus FHA, FirstGeneration Plus FHA, Preferred Plus Conventional, SmartStep Plus FHA, Schools To Home Conventional, and CHFA’s FHA Streamline available through my lender panel.
🚌 Bus Stop #3 — The El Paso County Numbers
CHFA sets income and purchase price limits by county, and they were last updated June 15, 2026. For El Paso County, on the FirstStep and FirstGeneration programs:
Non-targeted areas: $127,800 income limit for a 1–2 person household, $146,970 for 3 or more; purchase price limit of $566,730.
Targeted areas: $153,360 income limit for a 1–2 person household, $178,920 for 3 or more; purchase price limit of $692,670.
CHFA’s other first mortgage programs — SmartStep, Preferred, HomeAccess, and Schools To Home — use a flat $178,920 qualifying-income limit statewide and have no purchase price limit (though the total loan can’t exceed the lower of $832,750 or what your loan type allows). A minimum mid-credit score of 620 applies across CHFA’s programs, along with a required CHFA-approved homebuyer education course and a minimum $1,000 borrower contribution.
🚌 Bus Stop #4 — What This Looks Like in Real Dollars
Numbers are easier to picture with an example. Say you’re financing a $350,000 first mortgage:
Grant: 3% of $350,000 is $10,500 — under the $25,000 cap, so you’d get $10,500 with nothing to pay back.
Second mortgage: 4% of $350,000 is $14,000 — also under the cap, so you’d get $14,000, deferred until you sell, refinance, or pay off the loan.
On a smaller loan, say $150,000, the same math gives you $4,500 (grant) or $6,000 (second) — the percentage matters more than the flat dollar cap until your loan amount climbs into the mid-$600,000s.
🚌 Bus Stop #5 — What’s Not Available Yet
Two CHFA options worth knowing about, even though I can’t offer them through my lender panel just yet: CHFA HomeAccess Plus (for eligible veterans and buyers with disabilities) and a CHFA program for police officers. My wholesale lender has told me both are in the works, but neither is live on my panel today — so consider this a heads-up to check back rather than something to count on for your purchase timeline right now. If either applies to your situation, ask me directly and I’ll give you my honest, current answer.
Helpful Tools
How Much Down Payment Do You Really Need?
Frequently Asked Questions
Do I ever have to repay CHFA’s down payment assistance?
Only if you took the second mortgage option. The grant is never repaid. The second mortgage is a real loan — deferred, with no monthly payment — that comes due when you sell the home, refinance, or pay off your first mortgage.
Can I use CHFA if I’ve owned a home before?
It depends on the program. FirstStep and FirstGeneration are generally restricted to first-time buyers, qualified veterans, or buyers purchasing in a targeted area. SmartStep and Preferred have no first-time-buyer requirement at all, so repeat buyers can use those.
What credit score do I need for CHFA programs?
CHFA requires a minimum mid-credit score of 620 for all scored borrowers, with some flexibility for borrowers who have no credit score. Your lender’s underwriting guidelines still apply on top of that.
Is CHFA down payment assistance actually available here in Colorado Springs and El Paso County?
Yes — CHFA is a statewide program, and El Paso County has its own income and purchase price limits under CHFA’s FirstStep and FirstGeneration programs (see Bus Stop #3 above). It’s worth checking those specific numbers rather than assuming a friend’s Denver-area limits apply here.
Can I combine CHFA assistance with other down payment help?
CHFA’s programs are designed to pair with a CHFA first mortgage, and stacking with additional outside assistance depends on the specific programs involved. Bring me what else you’re considering and I’ll tell you honestly whether it stacks.
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