What Are Home Buying Grants?

Home buying grants are financial assistance programs designed to help individuals—particularly first-time and low-income buyers—cover the cost of purchasing a home. Unlike loans, grants typically don’t need to be repaid. They can reduce your down payment, help with closing costs, or even provide funds for renovations.

These grants are often:

Run by state or local governments

Administered through nonprofit organizations

Funded by federal programs like HUD or FHA

Each grant has specific eligibility requirements, but many are surprisingly accessible to working families, single parents, and renters looking to buy.

1. Down Payment Assistance Grants

One of the most sought-after grant types is down payment assistance (DPA). These grants can cover a portion—or in some cases, all—of your down payment.

You may qualify for DPA if you:

Are a first-time homebuyer

Earn less than a certain income threshold

Are buying in an eligible neighborhood

Complete a homebuyer education course

Some cities offer DPA up to $15,000 for qualified buyers, especially in revitalization zones where homeownership is being encouraged.

2. First-Time Homebuyer Grants

These are often tied to state-level housing authorities. For example:

California’s CalHFA program

Florida’s First-Time Homebuyer Program

Texas State Affordable Housing Corporation (TSAHC)

They typically include:

Down payment help

Fixed-rate mortgage options

Closing cost assistance

Forgivable second loans (which act like grants)

Even if you’ve owned a home in the past, you may still qualify if you haven’t owned in the last 3 years.

3. HUD Good Neighbor Next Door Program

This lesser-known federal program offers 50% off the list price of homes for qualifying buyers—like teachers, police officers, firefighters, and EMTs.

Here’s how it works:

The home must be located in a designated revitalization area

You must live in it as your primary residence for at least 3 years

You commit to community-based homeownership

If you qualify, the savings can be substantial, with some buyers purchasing homes at half their original price.

4. USDA and Rural Housing Grants

If you're open to living outside of metro areas, the USDA offers grants and loans to support rural homeownership.

Benefits include:

Zero down payment options

Low-interest loans

Grants for home improvements

Flexible credit criteria

Thousands of properties across the country qualify—even some close to suburban hubs. You don’t need to be a farmer or live in isolation to benefit from this.

5. Local City and County Programs

Many cities and counties offer targeted grants based on housing shortages or revitalization plans. These programs are often overlooked because they’re:

Hyper-local

Less advertised

Administered through housing departments or community nonprofits

What you might find:

Grants for homes in specific neighborhoods

Help for single parents or seniors

Assistance tied to income or household size

Your local housing authority is the best place to start. Even if your area doesn’t advertise a formal grant program, it may offer closing cost reimbursements or loan forgiveness based on length of ownership.

How to Find Grants You Qualify For

To identify what’s available to you, try these steps:

Search your state’s housing finance authority (HFA)

Most states have dedicated first-time buyer pages with eligibility tools.

Use HUD’s list of local resources

HUD.gov breaks down available programs by state and municipality.

Connect with a certified housing counselor

Many nonprofit agencies offer free consultations and grant navigation help.

Ask your real estate agent

Some agents specialize in helping buyers access public programs.

Eligibility Tips: Do You Qualify?

While each program is different, you may be eligible if:

You make less than 80% of your area’s median income

You are a first-time homebuyer

You plan to live in the home as your primary residence

You’re buying in a specific zip code or school district

You complete a homebuyer education course

Many programs also consider factors like:

Family size

Employment field (e.g., healthcare, education, service)

Veteran status

Myths About Homebuyer Grants

Let’s clear up a few common misconceptions:

“They’re only for very low-income families”

Not true. Many grants are open to middle-income households, especially in high-cost-of-living areas.

“It’s too complicated to apply”

Most programs have step-by-step guides and counselors to help you apply correctly.

“They won’t cover enough to make a difference”

Some programs provide up to $25,000, which can eliminate your down payment altogether.