First-Time Homebuyer Programs in Colorado for 2026: Every Assistance Option Available

Your Complete Guide to First-Time Buyer Assistance in Colorado

If you're buying your first home in Colorado in 2026, you have access to more assistance programs than most people realize. Between state-level programs, federal loan options, and local initiatives—especially in mountain communities fighting workforce housing shortages—there are meaningful ways to reduce your upfront costs and make homeownership achievable.

Colorado Housing and Finance Authority (CHFA) Programs

CHFA is Colorado's primary source of first-time buyer assistance. Their programs include:

CHFA FirstStep and FirstStep Plus

• 30-year fixed-rate mortgage at competitive rates
• Down payment assistance up to 3% of the loan amount (grant or second mortgage)
• Available statewide including mountain communities
• Income limits apply (vary by county—generally up to $150,000 for a household in metro areas, higher in mountain counties)
• Minimum credit score: 620
• Homebuyer education required (available online)

CHFA SmartStep

• Higher down payment assistance (up to 4%) in exchange for a slightly higher interest rate
• Same eligibility as FirstStep programs
• Second lien is forgiven after a set period (typically 3 years of on-time payments)

Federal Loan Programs

FHA Loans

• 3.5% down payment with 580+ credit score
• 2026 FHA loan limit in Colorado ranges from $524,225 (baseline) to higher in designated high-cost counties
• Upfront and monthly mortgage insurance required
• Flexible debt-to-income ratios (up to 50% in some cases)
• Works well for condos that have FHA approval—check individual projects in mountain communities

VA Loans

• $0 down payment for eligible veterans and active-duty service members
• No monthly mortgage insurance
• Competitive rates (typically 0.25–0.5% lower than conventional)
• No loan limit for borrowers with full VA entitlement
• Learn about VA loans at Cedar Home Loans

USDA Loans

• $0 down payment for properties in eligible rural areas
• Many Colorado mountain communities qualify as USDA-eligible
• Income limits apply (115% of area median income)
• Low monthly guarantee fees compared to FHA insurance

Mountain Community Workforce Housing Programs

Colorado's mountain towns are battling severe workforce housing shortages. Several communities have created innovative programs:

Summit County / Breckenridge

• Summit Combined Housing Authority: Deed-restricted homes at below-market prices for local workers
• Down payment assistance grants for qualifying income levels
• Long-term waitlists—apply early, even before you're ready to buy

Eagle County / Vail

• Eagle County Housing Department: Deed-restricted inventory and down payment assistance
• InDEED program: Local employer-sponsored assistance for essential workers

Steamboat Springs / Routt County

• Yampa Valley Housing Authority: Deed-restricted homes and down payment assistance
• Employer match programs where local businesses contribute to employee down payments

Telluride / San Miguel County

• San Miguel Regional Housing Authority: Below-market deed-restricted homes
• Workforce housing lottery for new developments
• Income qualification required (AMI-based)

Combining Programs for Maximum Benefit

Many of these programs can be combined. For example:

• CHFA first mortgage + CHFA down payment assistance + local workforce housing = minimal out-of-pocket
• FHA loan + CHFA second lien + seller concessions = potentially less than 1% cash from the buyer
• VA loan + local employer assistance = $0 down + closing cost coverage

Qualifying Tips for 2026

1. Complete homebuyer education early. CHFA requires it, and many local programs do too. This is available online and typically takes 4–8 hours.
2. Check income limits for your county. Mountain counties often have higher income limits than you'd expect due to high area median incomes.
3. Apply to workforce housing waitlists now. Some lists have 1–3 year waits. Getting in line early gives you options.
4. Get pre-approved before you shop. Knowing your exact budget—including assistance programs—prevents heartbreak.
5. Work with a lender experienced in assistance programs. Not every lender is approved to originate CHFA loans or familiar with local workforce housing requirements.

Cedar Home Loans Is CHFA-Approved

We originate CHFA loans and are familiar with workforce housing programs across Colorado's mountain communities. Start your application or contact us to discuss which combination of programs works best for your situation.