Don’t Let the Down Payment Hold You Back
For many homebuyers, especially first-timers, the biggest hurdle to homeownership isn’t the monthly mortgage—it’s the down payment. But here’s the good news: you have more options than you might think. From borrowing against your own assets to tapping into trusted local and state down payment assistance programs, Colorado offers a variety of solutions.
Let’s break down how to take the next step toward owning your home—even if you don’t have 20% saved up.
1. Borrowing from Yourself: Retirement Accounts & Gifts
If you’ve been steadily contributing to a retirement plan like a 401(k) or IRA, you may be able to borrow from yourself to cover your down payment. Here’s how:
- 401(k) Loans: Many employer-sponsored 401(k) plans allow you to borrow up to $50,000 or 50% of your vested balance. You’ll repay it with interest, but the interest goes back into your own account.
- IRA Withdrawals: First-time homebuyers can withdraw up to $10,000 from a traditional or Roth IRA without paying the early withdrawal penalty (though taxes may apply).
- Gifts from Family: If you’re getting help from relatives, lenders will require a signed gift letter stating the money doesn’t need to be repaid.
Tip: Talk with a loan advisor before moving retirement funds. Early withdrawals or missteps could trigger taxes or penalties.
2. CHFA: Colorado’s Leading Statewide Program
The Colorado Housing and Finance Authority (CHFA) offers down payment assistance for qualifying buyers across the state.
- Assistance up to 5% of your loan amount.
- Use it for down payment and closing costs.
- Must complete a CHFA-approved homebuyer education course.
- Income and credit score requirements apply (minimum 620 credit score).
Visit: https://www.chfainfo.com
CHFA loans can be paired with conventional, FHA, VA, or USDA loans, giving you flexibility based on your financial profile.
3. CHAC: Colorado Housing Assistance Corporation
CHAC offers second mortgage loans for down payment assistance, especially for low-to-moderate income buyers.
- Can be used in conjunction with FHA.
- Income limits apply.
- Typically offers deferred payments, so you don’t have to repay until you sell, refinance, or pay off your first mortgage.
Learn more: https://www.chaconline.org
4. Douglas County Down Payment Assistance
If you’re buying in Douglas County, you’re in luck—there’s a local down payment assistance program that offers support to moderate-income households.
- Down payment assistance loans of up to $25,000.
- Designed for first-time buyers who live or work in Douglas County.
- Must meet income limits and attend homebuyer education.
Info & application: https://www.douglas.co.us → Search: “Down Payment Assistance”
Programs vary by city and county—so be sure to check what’s available in your area!
5. Stacking Programs for Maximum Benefit
Yes, you can combine some of these programs! For example:
- Use CHFA for your primary mortgage and down payment help.
- Layer CHAC on top for additional assistance.
- Add employer assistance or a 401(k) loan to fill any gaps.
A qualified mortgage broker (like us!) can guide you through what can be layered and how to meet each program’s requirements.
Final Thoughts: Don’t Go It Alone
The path to homeownership is easier when you work with a team that knows Colorado’s down payment landscape inside and out. At Mortgage Consulting Group, we’ll walk you through your options and help you qualify for programs that save you money—both upfront and long term.
Let’s talk about your down payment options—whether you’re buying in Centennial, Douglas County, or anywhere across Colorado.
Call or message us today to schedule your free consultation.
Visit: https://mortgageconsulting.group