CHFA raised its income and purchase price limits effective June 15, 2026 — here are the new El Paso County (Colorado Springs) numbers, the year-over-year change, and who qualifies.
Colorado Down Payment Assistance 2026: CHFA Guide
The short answer: In 2026, the Colorado Housing and Finance Authority (CHFA) helps buyers cover the down payment two ways: a grant of up to the lesser of $25,000 or 3% of your first mortgage that never has to be repaid, or a deferred second mortgage of up to the lesser of $25,000 or 4%. You pick one, not both. The help comes through CHFA’s FirstStep and FirstGeneration programs, which pair it with a 30-year fixed loan — and income and price limits apply by county.
The down payment is the wall most first-time buyers in Colorado Springs hit. CHFA’s down payment assistance is built to lower that wall — and a lot of buyers who assume they don’t qualify actually do. Here’s exactly how it works in 2026, who’s eligible, and what the El Paso County numbers look like.
The two kinds of CHFA down payment assistance
CHFA offers down payment assistance (DPA) in two forms. You choose one:
| Option | How much | Repayment |
|---|---|---|
| DPA Grant | Up to the lesser of $25,000 or 3% of your first mortgage | None — it’s a grant, you never pay it back |
| DPA Second Mortgage | Up to the lesser of $25,000 or 4% of your first mortgage | Deferred — repaid only when you sell, refinance, or pay off the first mortgage |
To put real numbers on it: on a $200,000 first mortgage, CHFA’s own examples show the grant running up to about $6,000 and the second mortgage up to about $8,000. The money can go toward your down payment, closing costs, prepaids, or even a principal reduction. You can take the grant or the second mortgage — not both.
Source: CHFA Down Payment Assistance program details, 2026.
FirstStep vs. FirstGeneration — which program fits you
The assistance comes through two of CHFA’s lowest-rate loan programs:
- CHFA FirstStep — for first-time homebuyers, qualified veterans, or buyers purchasing in a federally designated “targeted” area. It’s used with FHA, VA, and USDA loans (the FirstStep Plus version covers conventional loans).
- CHFA FirstGeneration — for buyers where at least one borrower is a first-generation homebuyer. It offers up to $25,000 in down payment assistance as a deferred second mortgage, paired with a 30-year fixed loan.
“Qualified veteran” matters in Colorado Springs: if you’ve served, the first-time-buyer requirement can be waived, which opens FirstStep to more of our military community.
Who qualifies for CHFA assistance
The core 2026 requirements:
- Credit: a mid credit score of 620. CHFA also allows borrowers with no credit score, with exceptions.
- Homebuyer education: every borrower and co-borrower must individually complete a CHFA-approved homebuyer education course (online or in person) before closing. The certificate is good for 12 months.
- Your own money in the deal: a minimum financial investment of $1,000 from the borrower toward the purchase.
- Income and purchase price limits apply by county and program (below).
The income and price limits for Colorado Springs (El Paso County)
FirstStep and FirstGeneration cap both your household income and the home’s price. For El Paso County in 2026 (non-targeted areas):
| El Paso County limit | Amount |
|---|---|
| Income — 1–2 person household | $127,800 |
| Income — 3+ person household | $146,970 |
| Maximum purchase price | $566,730 |
Targeted areas within the county allow higher limits. These figures took effect June 15, 2026 — see our full breakdown of the new CHFA income limits for Colorado for every county and the year-over-year change.
Source: CHFA Home Finance Program Income Limits, effective June 15, 2026.
How the money actually works at closing
If you take the grant, the up-to-3% is applied at closing and that’s the end of it — nothing to repay, no second payment. If you take the second mortgage, the up-to-4% (max $25,000) is a separate, deferred loan: there’s no monthly payment on it, and you settle it only when you sell the home, refinance, or pay off your first mortgage. For a buyer who’s short on cash today, that deferral is the whole point — it gets you in the door now and squares up later, ideally from your home’s appreciation.
How to use CHFA assistance in Colorado Springs
The path is straightforward:
- Confirm your household income is under the El Paso County limit for your household size.
- Complete a CHFA-approved homebuyer education course (keep the certificate — it’s valid 12 months).
- Work with a lender who can originate CHFA loans to choose FirstStep or FirstGeneration and the grant vs. second-mortgage option that fits your cash position.
Not sure whether you clear the income limit, or which DPA option leaves you better off? That’s a quick conversation worth having before you start touring homes. Reach out to 719 Lending and we’ll run your numbers and map out the assistance you can actually get.
Frequently asked questions
How much down payment assistance does CHFA give in 2026?
Either a grant of up to the lesser of $25,000 or 3% of your first mortgage (no repayment), or a deferred second mortgage of up to the lesser of $25,000 or 4%. On a $200,000 mortgage, CHFA’s own examples put that around $6,000 (grant) or $8,000 (second mortgage). You choose one option, not both.
Does CHFA down payment assistance have to be repaid?
The grant does not — it’s forgiven by design. The second mortgage does, but it’s deferred: no monthly payment, and you repay it only when you sell, refinance, or pay off your first mortgage.
What credit score do I need for a CHFA loan?
A mid credit score of 620. CHFA also allows borrowers with no credit score, with exceptions, so it’s worth asking even if your file is thin.
Who qualifies for CHFA FirstStep in Colorado?
First-time homebuyers, qualified veterans, and buyers purchasing in a federally designated targeted area. In El Paso County the 2026 income limit is $127,800 for a 1–2 person household and $146,970 for 3 or more (non-targeted areas), with a $566,730 purchase price limit.
Do I have to take a class to get CHFA assistance?
Yes. Every borrower and co-borrower must individually complete a CHFA-approved homebuyer education course before closing. The certificate stays valid for 12 months.
What’s the difference between FirstStep and FirstGeneration?
FirstStep is for first-time buyers, veterans, or targeted-area buyers. FirstGeneration is specifically for households where at least one borrower is a first-generation homebuyer, and it offers up to $25,000 in deferred down payment assistance with a 30-year fixed loan.
719 Lending Inc. is a private mortgage broker and is not affiliated with, or acting on behalf of, the Colorado Housing and Finance Authority (CHFA) or any government agency. CHFA program terms, assistance amounts, and income/purchase price limits are set by CHFA and are subject to change; confirm current details and your eligibility with CHFA or your lender.
719 Lending Inc., NMLS #1601989 · Equal Housing Opportunity · This article is educational only, is not a commitment to lend, and not all applicants will qualify.
