Virginia DHCD HOMEownership Down Payment and Closing Cost Assistance Program

At a glance

Amount

Up to 10% of the price (15% in high-cost localities, which includes most of Northern Virginia) plus up to $2,500 for closing costs, capped at $40,000

Type of help

Forgivable loan

Where

Statewide, Virginia

Run by

Virginia Department of Housing and Community Development (DHCD), through local nonprofit DPA providers

First-time buyer

First-time buyers only

Income limit

Up to 80% of area median income

Price limit

Yes, see below

Minimum credit score

620

Homebuyer education

Required

Your own funds

At least $500

How the forgivable loan works

A second loan with no payment that is forgiven over time or after a set number of years in the home.

• Interest: 0%
• Monthly payment: None
• Forgiveness: DHCD calls it a deferred conditional grant. Live in the home as your primary residence for the affordability period and it is satisfied: 5 years for $1,000 to $14,999 of HOME assistance, 10 years for $15,000 to $40,000, 15 years for amounts over $40,000 (when combined with other HOME help).
• When you would repay: Sale, refinance, a home equity line, renting the home out, or moving out before the affordability period ends. Any of these makes the full amount due.

Who qualifies

• First-time buyers only. First-time means you have never owned a home, or you have not held primary ownership in a principal residence in the last 3 years. Prior investment or inherited property you did not live in does not count against you.
• Income. Total household income at or below 80% of area median income for your locality and household size, using HUD's HOME limits (updated each June or July; the 2026 table is on DHCD's page). In the Washington-Arlington-Alexandria area the 2026 HUD 80% limits run from $74,800 for 1 person to $106,800 for 4 people, as published by Prince William County for the same HUD area. Income of everyone 18 and over counts, except full-time students.
• Price. Price cannot exceed 95% of the area median purchase price under HUD's HOME limits. DHCD's table (effective 2025-12-01), existing homes: $760,000 Arlington; $689,000 Fairfax County and Alexandria; $790,000 Falls Church; $580,000 Fairfax City; $599,000 Loudoun; $485,000 Prince William, Stafford, Manassas, Manassas Park, Fredericksburg. New construction limits run higher.
• Property types: Single-family detached, Townhouse, Condo, Modular home, Manufactured home on owned or long-leased land, One unit of a 2 to 4 unit building you will live in. Must be your primary residence.
• You apply through a DHCD-approved local provider, not the state. On the August 2026 list, Habitat for Humanity Virginia covers most Northern Virginia localities and Catholics for Housing covers Arlington, Loudoun, Prince William, Manassas, and Manassas Park.
• Other listed providers: People Inc. for Manassas, and Blue Ridge Housing Network for Fauquier. Habitat for Humanity Virginia also lists Alexandria, Fairfax City and County, Stafford, Fredericksburg, Spotsylvania, and Fauquier.
• Buyer contribution: 1% of the sales price from your own funds if your income is 50% to 80% of AMI, or $500 if it is under 50% of AMI. Receipts for appraisal, inspection, and similar costs count.
• If your cash assets are 10% or more of the sales price you are not eligible.
• Minimum 620 median FICO score, at least 90 days of work history, and debt ratios around 38% housing and 45% total (up to 50% with compensating factors).
• The first mortgage cannot exceed 96.5% loan-to-value, and all liens together cannot exceed 108% of value. Total loan origination charges are capped at 2.5% of the loan.
• The home must pass a HUD physical condition inspection and, if built before 1978, a lead paint visual assessment. Required repairs must be finished before closing.
• Homebuyer education from a HUD-certified agency (Virginia Housing's class qualifies) plus one-on-one counseling with a HUD-certified counselor.

How to apply

1. 1Find the DPA provider that serves the locality where you are buying on DHCD's provider contact list and ask whether they have funds this contract year. Funds are first come, first served and some providers keep waiting lists.
2. 2Complete a HUD-certified homebuyer education course (Virginia Housing's free class counts) and a counseling session with a HUD-certified housing counselor.
3. 3Get pre-approved with a lender. The provider cannot reserve funds until you are pre-approved and meet the program rules.
4. 4Once you have a ratified contract, the provider verifies income, assets, credit, and the property, orders the required inspections, and submits the request to DHCD.
5. 5Sign the homebuyer agreement and the DPA lien documents at closing. DHCD wires the funds to the settlement agent.

Watch out for

• Coverage in Northern Virginia depends on which nonprofits hold a current DHCD contract. Check the provider list for your locality first, and expect a waiting list when a provider has spent its allocation.
• The assistance amount is based on need. Providers size it from your debt ratios, so the 10% or 15% figure is a ceiling, not a promise.
• Refinancing or opening a home equity line during the affordability period makes the full amount due. Plan to hold the home for the whole period.
• The $40,000 cap includes the closing cost piece. In Northern Virginia prices the percentage will usually be limited by the cap, not the 15%.
• Older DHCD FAQ pages mention up to 20% in high-cost areas. The current guidelines (revised October 2024) say 15%. Go with the guidelines.
• DHCD also runs a separate Virginia DPA Pilot for households at or below 60% of AMI, with up to $50,000 through a smaller set of administrators. Ask your provider whether it participates.

Straight answers

Sources

• DHCD Homeownership Down Payment Assistance Program (DPA) page (read Sep 23, 2026)
• DHCD HOME DPA Program Guidelines (Revised October 2024) (read Sep 23, 2026)
• DHCD DPA Local Provider Contact List (Revised August 2026) (read Sep 23, 2026)
• DHCD Down Payment Assistance Frequently Asked Questions (affordability periods) (read Sep 23, 2026)
• DHCD HOME and Housing Trust Fund Homeownership Sales Price Limits (effective 2025-12-01) (read Sep 23, 2026)
• DHCD 2026 HUD HOME Income Limits for Virginia (read Sep 23, 2026)
• Prince William County 2026 Median Income Tables for the Washington-Arlington-Alexandria HUD area (effective 2026-06-01) (read Sep 23, 2026)
• DHCD Virginia DPA Pilot Program Guidelines (read Sep 23, 2026)

Program details are summarized from public sources and change without notice. Funding badges reflect the last time we checked, not a guarantee of availability. This is buyer education from a real estate agent, not a loan pre-approval or a commitment to lend. Eligibility is decided by each program administrator and your lender. Equal Housing Opportunity.