CHFA Down Payment Assistance Program

The CHFA DAP loan can be a helpful resource for first-time homebuyers in Connecticut who are struggling to come up with the funds for a down payment and closing costs. However, it's important to carefully consider the terms and conditions of the loan, as well as the potential long-term financial implications, before deciding if it's the right choice for you.

What is the Connecticut Housing Finance Authority ?

The Connecticut State Legislature established the Connecticut Housing Financing Authority (CHFA) in 1969 to give low- and moderate-income families and individuals broader access to affordable housing.

To qualified first-time buyers, CHFA offers a range of mortgages with interest rates that are below market or competitive. Additionally, the CHFA provides specific financing programs to help renters who receive public assistance buy homes responsibly and to encourage borrowers to reside close to their places of employment. Qualified homeowners without the necessary cash for a down payment or closing costs can also apply for the Down Payment Assistance Program.

What is the CHFA Down payment Assistance Program Loan ?

The Connecticut Housing Finance Authority (CHFA) offers a Downpayment Assistance Program (DAP) to help eligible first-time homebuyers purchase a home in Connecticut. The program provides a low-interest, second mortgage loan to be used for down payment and closing costs.

Eligibility for the CHFA DAP includes meeting certain income and credit requirements, being a first-time homebuyer (or not having owned a home in the past three years), and purchasing a home within certain price limits. The program also requires completion of a homebuyer education course.

Low-interest second mortgages of up to $20,000 are available to first-time homebuyers through the CHFA Down Payment Assistance Program. The minimum amount for your DAP loan is $3,000, but it cannot be greater than the minimal down payment needed for your home, which is typically between 3% and 3.50%.

A Down Payment Assistance Program Loan is offered by the Connecticut Housing Finance Authority at low interest rates between 1% and 1.5%. Borrowers must qualify for a CHFA mortgage with a participating lender and attend a homebuyer education class and contribute at least $1,000 toward the cost of the home. Your lender will consult with you to decide how much of a down payment is necessary for your mortgage loan and to confirm that you have the financial means to repay both your first mortgage and the DAP loan.

Key Facts of CHFA DAP Loan

  • A DAP loan can be used by borrowers to pay for the closing fees and down payment.
  • A down payment assistance program loan is a second mortgage on your home.
  • Borrowers are eligible to seek for assistance up to $20,000.
  • The minimum DAP loan amount is $3,000, however it cannot be more than the required minimum down payment for the home.
  • When the house is sold, refinanced, or is no longer used as the principal residence, the loan must be repaid in full.

How the Down payment Assistance Program Works ?

Borrowers can get a loan to cover their down payment and closing costs through the Connecticut Housing Finance Authority's (CHFA) Down payment Assistance Program. Before applying, candidates must achieve certain credit requirements and complete a course on home buying.

Prior to participating in the Down payment Assistance Program, homebuyers must obtain a mortgage with a CHFA-approved lender. DAP help is provided in the form of a second mortgage-like low-interest loan. The DAP interest rate will often be the same as the first mortgage's interest rate.

Before to closing, you must attend a free homebuyer education course. The course will give you advice on house maintenance and assist you in understanding the home-buying process. Both in-person and online classes are offered in Connecticut.

Benefits of CHFA Down Payment Assistance Program

  • Financing to cover closing costs and down payment.
  • Assistance for purchasing a home up to $20,000.
  • Low-interest rate second mortgage at 1.00% (1.10% -1.50% APR) for loan reservations with dates ranging from April 30, 2021 to December 31, 2023.

Who is Eligible for CHFA Down Payment Assistance Program ?

In order to qualify for a loan under the DAP loan, applicants must fulfil the following criteria :

  • Borrower must first qualify and apply for a CHFA mortgage from a CHFA- Participating Lender.
  • Borrower must be a first-time homebuyer or someone who hasn't bought a property in the last three years.
  • The property must be the borrower’s primary residence.
  • Both the sales price of the home and the borrower's income must fall under the CHFA Sales Price Limitations.
  • The borrower must prove their capacity to repay both the DAP loan and the CHFA first mortgage.
  • All savings over $10,000 must be applied to the down payment. (With the exception of your retirement account)
  • Before closing the sale, the buyer must go to a free homebuyer education course. Classes are held online and at locations across Connecticut.

Use the CHFA Resource Map to locate information on income limits, sales limits, and CHFA-approved lenders.

CHFA Participating Lenders

To provide low interest or competitive loans to qualified homeowners, the Connecticut Housing Finance Authority has teamed with approximately 70 participating banks and mortgage businesses around the state. Before they are permitted to originate, process, and close CHFA home loans, all Connecticut Housing Finance Authority participating lenders must complete training on the CHFA mortgage programs and criteria.

How to Apply CHFA Down Payment Assistance Program ?

Apply by contacting a CHFA Participating Lender in your area. The lender may charge a $200 application fee. You can contact the CHFA Homeownership Department by phone at (860) 571-3541 or by email at, if you have any further inquiries.

There may be grants or low-interest loans available from your city or town to help with the down payment. Make sure you ask the Department of Economic and Community Development in your area. Consult your benefits office for more information if your workplace provides grants or loans.

CHFA Contact

For other questions :
  • Call : (860) 721-9501 
  • Email :