Buying a home in Aurora can feel just out of reach when the down payment and closing costs stack up. If you are exploring ways to bridge the gap, down payment assistance can help you move sooner and keep more cash on hand after closing. You deserve a clear, local guide that cuts through the noise and points you to reliable next steps.
In this starter guide, you will learn what down payment assistance is, the programs Aurora buyers commonly use, how assistance pairs with FHA and conventional loans, what to expect for eligibility, and a practical step-by-step plan. You will also find trusted sources to verify details as you move forward. Let’s dive in.
What down payment assistance covers
Down payment assistance, or DPA, helps you cover part of your down payment and sometimes your closing costs. Programs are structured in different ways, and each one has its own rules.
- Grants: One-time assistance that does not require monthly payments.
- Second mortgages or subordinate loans: Often zero or low interest. Some are deferred with no monthly payment, others amortize over time.
- Forgivable second loans: The balance is forgiven over a set number of years if you stay in the home and meet program rules.
- Mortgage Credit Certificates (MCCs): Reduce your federal income tax liability rather than provide cash at closing.
- Employer or nonprofit assistance: Targeted benefits for certain employees or community members.
Most programs are designed for primary residences and often include income and purchase price limits. Many require homebuyer education and may target first-time buyers, though some expand eligibility for groups like veterans or teachers.
Aurora and Colorado programs to check first
Statewide: CHFA
The Colorado Housing and Finance Authority is a leading resource for buyers across the Denver metro area. CHFA offers mortgage products plus DPA options and typically works through CHFA-approved lenders. Homebuyer education may be required. Start by exploring the current mortgage and assistance options with the Colorado Housing and Finance Authority.
City and county resources
Local funding and guidance can make a difference, especially when programs refresh each year. Check the City of Aurora’s official housing and community services pages for any active assistance, waitlists, or referrals to HUD-approved counseling. Begin with the City of Aurora housing programs. Also review county-level options or referrals that may use federal funds. Visit Arapahoe County housing resources to see whether county-administered assistance is available.
Nonprofits and employer programs
Housing authorities, community development nonprofits, credit unions, and employers sometimes offer smaller grants or forgivable loans. These options can occasionally be combined with statewide assistance, but stacking rules vary, so confirm details with the program administrator and your lender.
Loans that pair well with DPA
FHA loans
FHA-insured mortgages allow assistance from acceptable sources such as grants and subordinate financing, provided the lender documents the funds and the terms meet FHA requirements. FHA loans include upfront and annual mortgage insurance premiums, so factor those costs into your monthly payment. Learn more about FHA basics on the FHA program page.
VA loans
If you are an eligible veteran or service member, VA loans can offer no down payment, and sellers may contribute to closing costs. Some buyers use local assistance to cover remaining closing gaps. Review eligibility and benefits through the VA home loan program.
USDA Rural Development
USDA loans provide 100 percent financing in eligible rural and some suburban areas. Aurora addresses may or may not qualify based on census tracts, so eligibility depends on the specific property location. You can review the program framework at USDA Rural Development and check eligibility during your property search.
Conventional options
Conforming conventional loans can work with DPA when the assistance meets investor rules. Fannie Mae’s HomeReady and Freddie Mac’s Home Possible are low-down-payment products with reduced mortgage insurance features and area or income eligibility. Learn more from Fannie Mae and Freddie Mac and ask your lender which DPA sources fit these products.
Who typically qualifies
While each program sets its own rules, you will see consistent themes:
- Income limits: Often tied to Area Median Income or a fixed cap that adjusts by household size.
- Purchase price or loan limits: Caps keep funds focused on affordable properties.
- First-time buyer status: Commonly defined as no homeownership in the past three years. Some programs waive this for targeted professions or situations.
- Occupancy and property type: Primary residence only. Single-family homes, many townhomes, and condos may be eligible; some condos require project approval.
- Credit and debt-to-income: You still need to qualify for the primary mortgage with acceptable credit and DTI.
- Homebuyer education: A class or counseling session is often required before closing.
- Documentation: Expect to document income, assets, and any gift funds according to lender and program rules.
- Resale or recapture provisions: Forgivable loans often require you to stay in the home for a period to avoid repayment. Some programs include resale restrictions.
Your step-by-step game plan
A clear process helps you stay on track and close smoothly.
- Get pre-qualified with a lender. You will learn your price range, spot any credit or budget gaps, and see how much assistance you still need.
- Map your assistance options. Review CHFA, the City of Aurora, Arapahoe County, and any nonprofit or employer programs that match your situation and the property location.
- Choose a participating lender. Many assistance programs require a program-approved lender and will route the application through that lender.
- Complete homebuyer education. Enroll in the program’s approved class or counseling if required.
- Submit your DPA application. Your lender coordinates the paperwork and timing with the assistance provider.
- Finalize loan structure. Confirm whether the assistance is a forgivable grant or a second mortgage and how it affects your total payment and closing funds.
- Coordinate closing. The title company and lender ensure assistance documents are accurate and recorded where required.
- Follow post-closing rules. Maintain occupancy and any program requirements to preserve forgiveness and avoid recapture.
Quick checklist
- Pre-qualification letter in hand
- DPA options narrowed to a primary choice and a backup
- Participating lender selected
- Homebuyer education completed
- Required income and asset documents ready
- Timelines confirmed for DPA approval and closing
Local tips for buying in Aurora with assistance
- Start early on DPA approvals. Some programs issue approvals quickly if your file is complete, while others take longer. Build that time into your offer and closing timeline.
- Be address specific. If you are exploring USDA or any geographically targeted program, eligibility can come down to the exact census tract. Confirm address eligibility as you tour homes.
- Balance price and property type. Assistance programs often include purchase price caps. Being flexible on location, property type, or features can help you stay within program limits.
- Plan for condo approvals. If you are looking at a condo, make sure your lender confirms project eligibility early to avoid delays.
- Use counseling resources. HUD-approved housing counselors and local housing offices can help you meet education requirements and understand program rules.
Risks and what to watch for
- Program changes: Funding levels and rules can change. Always confirm current details with the program administrator and your lender.
- Stacking assistance: Combining multiple second loans can increase your combined loan-to-value or add repayment risk. Verify lien priority and repayment terms before you commit.
- Resale restrictions or recapture: Some forgivable loans require you to stay in the home for a set period or repay funds if you sell earlier.
- Lender overlays: Even if a program allows a certain feature, some lenders may impose stricter rules. Align your lender choice with your preferred assistance program.
Where to verify details
Use these official sources as you research and confirm eligibility:
When you are ready to shop, a participating lender and a knowledgeable local agent can help you integrate assistance timelines with your home search and offer strategy.
Ready to explore homes in Aurora with a clear plan and the right support? Reach out to Savvy Property Group for guidance on neighborhoods, financing options, and a smooth path from pre-approval to closing.
FAQs
What is down payment assistance for Aurora buyers?
- DPA is financial help in the form of grants, forgivable loans, or subordinate financing that can cover part of your down payment and sometimes closing costs, typically for primary residences with income and price limits.
How much assistance can I get in Aurora?
Do I need to be a first-time buyer to use DPA in Colorado?
- Many programs require first-time buyer status, often defined as no homeownership in the past three years, though some make exceptions for eligible groups like veterans or specific professions.
Can I use DPA with an FHA loan in Aurora?
- Yes, FHA allows acceptable grants and subordinate financing when properly documented; you should also budget for FHA mortgage insurance premiums when comparing loan options.
How long does DPA approval take in Aurora?
- Timelines vary by program; some approve quickly with a complete file, while others require longer review periods, so begin the application early in your contract timeline.
Will DPA change my monthly payment?
- Grants and forgivable assistance typically do not add a monthly payment, but a second loan with interest or amortization can; many second loans are deferred or non-amortizing, so review terms with your lender.
Can I buy a condo in Aurora using DPA?
- Often yes, but condo projects may need approval and must meet program and lender requirements, so have your lender verify project eligibility early in the process.
