Colorado First-Time Home Buyer Programs: Denver Guide

Denver's housing market has shifted in ways that make first-time buyer programs more relevant — and more worth understanding — than they've been in years. The MSA-wide median list price sits at $587,000 as of April 2026, down 2.08% year-over-year, and the sale-to-list ratio has dropped to 0.995, meaning buyers are negotiating below list price on average. That's a real change from the bidding-war environment of prior cycles. At the same time, the 30-year fixed mortgage rate has climbed 50 basis points over the past three months to 6.51% as of May 21, 2026 — which means monthly carrying costs are rising even as prices soften. For a buyer financing a $712,500 mortgage, that three-month rate move translates to a $130/month increase in principal and interest.

The programs covered in this guide — CHFA, metroDPA, the Colorado First-Time Homebuyer Savings Account, and federal loan options — exist specifically to close the gap between what Denver buyers earn and what it takes to get to closing. Used individually, each one moves the needle. Stacked together, they can bring a qualified buyer to closing with minimal cash out of pocket. Here's what each program does, who qualifies, and how to combine them.

CHFA (Colorado Housing and Finance Authority) Home Loan Programs

CHFA — the Colorado Housing and Finance Authority — is the state's primary first-time buyer lending program, and it's the starting point for most Denver buyers who need down payment help. CHFA doesn't just offer a loan; it offers a structure: a first mortgage paired with an optional second-mortgage assistance layer.

The two main paths are CHFA FirstStep and CHFA SmartStep Plus.

CHFA FirstStep is a 30-year fixed FHA-backed first mortgage. Pair it with FirstStep Plus and CHFA adds a second mortgage of up to 4% of the first mortgage loan amount — deferred at 0% interest, due only when you sell, refinance, or pay off the home. There's no monthly payment on the second mortgage. It sits quietly until the transaction closes out.

CHFA SmartStep Plus follows the same structure but uses a conventional first mortgage instead of FHA. The DPA second mortgage is also up to 4% of the first mortgage, deferred at 0% interest on the same terms. If you're putting down enough to avoid FHA's mortgage insurance requirements, SmartStep Plus is worth comparing against FirstStep.

A few things apply to every CHFA program:

• CHFA defines a first-time homebuyer as someone who has not owned a primary residence in the past three years. If you owned a home but sold it more than three years ago, you still qualify.
• All CHFA programs require completion of a HUD-approved homebuyer education course before closing. The course typically runs 6–8 hours and is available online or in person through Denver-area providers listed on CHFA's site.
• Income and purchase-price limits are county-specific and updated annually. Denver, Adams, Arapahoe, Jefferson, and Douglas counties each have their own thresholds. Because these thresholds change year to year, check the current limit tables at chfainfo.com before building a purchase plan around CHFA — or have an approved CHFA lender pull the current figures for your specific county, which takes minutes.

CHFA's credit-score minimums are set at the program level and adjust periodically, so your lender will confirm the current floor when you apply.

metroDPA (Metro Down Payment Assistance Program)

metroDPA is the Denver metro's most flexible down payment assistance program — and for many buyers, it's the most powerful one available because of how the forgiveness works.

metroDPA provides up to 5% of the first mortgage loan amount as a forgivable second mortgage at 0% interest. The assistance applies to down payment and/or closing costs at closing. After three years of continuous owner-occupancy, the second mortgage is forgiven in full — you owe nothing. If you sell, refinance, or move out before the three-year mark, proportional recapture applies per the program terms.

That forgiveness structure is what separates metroDPA from a deferred loan. With CHFA's DPA, you're deferring repayment until you sell or refinance. With metroDPA, if you stay in the home for three years, the assistance disappears entirely.

metroDPA works with conventional, FHA, VA, and USDA first mortgages — it's loan-type agnostic, which makes it stackable with most financing structures Denver first-time buyers use. Geographic eligibility covers eight counties: Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, Jefferson, and Larimer. Properties outside those counties don't qualify.

Income limits and purchase-price caps for the Denver metro are updated regularly and vary by household size and county, and credit-score minimums are set at the program level. An approved metroDPA lender will pull the current figures for your situation — confirm them before building metroDPA into your purchase plan.

Colorado First-Time Homebuyer Savings Account

The Colorado First-Time Homebuyer Savings Account (FTHBSA) is a state-level savings vehicle that most buyers overlook — and that's a mistake, because it's one of the few programs that rewards you for saving before you're ready to buy.

Here's how it works: Colorado allows you to open a dedicated savings account and contribute up to $50,000 in total over the life of the account. Those contributions are deductible from your Colorado state income tax at the flat 4.4% state rate. The funds must be used toward the down payment and closing costs of a primary residence purchase in Colorado. Withdrawals for non-qualifying purposes trigger recapture of the deduction plus a penalty.

The FTHBSA uses the same first-time buyer definition as most Colorado programs: someone purchasing a primary residence who hasn't owned one recently. The state statute governs the specifics; check with a Colorado CPA or the Colorado Department of Revenue for the current eligibility rules before opening an account.

The tax benefit here is state-only — federal taxes aren't affected. But for a buyer who's 12–24 months out from purchasing, the FTHBSA is a straightforward way to build a down payment fund while reducing your Colorado tax bill in the years leading up to closing.

FHA, VA, and USDA Loans: Federal Programs Available to Colorado Buyers

Federal loan programs are the foundation most Colorado first-time buyers build on — and understanding the differences between them determines which state and local programs you can layer on top.

FHA loans are the most widely used entry point. The minimum down payment is 3.5% with a credit score of 580 or higher. Borrowers with scores between 500 and 579 can still qualify but face a 10% minimum down payment. The 2026 FHA single-family loan limit for the Denver-Aurora-Lakewood MSA — covering Denver, Arapahoe, Jefferson, Adams, and Douglas counties — is $833,200 for a one-unit property. Multi-unit FHA limits for the same MSA are higher: $1,066,750 for two units, $1,289,150 for three units, and $1,602,200 for four units.

FHA loans carry two layers of mortgage insurance. The upfront mortgage insurance premium (UFMIP) is 1.75% of the base loan amount and can be financed into the loan rather than paid at closing. The annual mortgage insurance premium (MIP) for 30-year loans with a base loan amount at or below $726,200 and LTV above 95% is 0.55% per year, per HUD's 2023 schedule. For loans with less than 10% down, the annual MIP runs for the life of the loan; with 10% or more down, it drops off after 11 years.

VA loans are the strongest product available to eligible borrowers — 0% down payment, no private mortgage insurance, and no loan limit for buyers with full entitlement. Eligibility extends to veterans, active-duty service members, National Guard and Reserve members with qualifying service, and surviving spouses. VA loans carry a funding fee at closing (which can be financed into the loan): 2.15% of the loan amount for first-time use with 0% down, and 3.3% for subsequent uses. Disabled veterans receiving compensation are exempt from the funding fee entirely.

USDA loans offer 0% down for properties in USDA-designated rural areas, targeting low-to-moderate-income buyers whose income falls below 115% of the area median income for their household size. For the Denver Front Range, USDA eligibility applies to properties outside the I-25/I-70 metro core — typically exurban areas in Adams, Arapahoe, Douglas, and Weld counties at the edge of the metro footprint. Most of central Denver and the inner-ring suburbs don't qualify. Use USDA's interactive eligibility map at eligibility.sc.egov.usda.gov to verify a specific address before counting on this program.

How to Stack Programs: Combining CHFA, metroDPA, and Federal Loans

Here's what most buyers don't realize: these programs aren't mutually exclusive. CHFA and metroDPA can be stacked on the same purchase — a CHFA first mortgage paired with a metroDPA forgivable second mortgage. That combination can bring a qualified Denver-metro first-time buyer to closing with minimal cash out of pocket.

The most common stacking combinations Denver first-time buyers use:

• CHFA FirstStep + metroDPA: CHFA provides the FHA-backed first mortgage; metroDPA layers a forgivable second mortgage on top. The CHFA DPA (FirstStep Plus) and metroDPA can potentially both be in play — confirm with an approved lender whether both second mortgages can stack simultaneously, as lender-level approval rules govern this.
• CHFA SmartStep Plus + metroDPA: Same structure on a conventional first mortgage. Useful when a buyer's credit profile and down payment position make conventional financing more cost-effective than FHA.
• metroDPA + VA: For eligible veterans, VA's 0% down paired with metroDPA's forgivable second can cover closing costs entirely. metroDPA is loan-type agnostic and explicitly covers VA first mortgages.

The practical ceiling on stacked assistance depends on the specific programs, the loan amount, and the lender. CHFA's DPA is up to 4% of the first mortgage; metroDPA's is up to 5%. Together, a buyer could potentially access assistance covering a meaningful share of both down payment and closing costs — but the exact combination requires a lender who is approved for both programs and can confirm current combinability rules.

One important note: program stacking rules change. What's combinable today may have different terms next quarter. Build your purchase plan with an approved CHFA + metroDPA lender, not from a static guide. The programs are real and the stacking is real — the specifics need to be confirmed in real time.

Ready to Use a Colorado First-Time Buyer Program? Here's How We Help

Understanding the programs is step one. Knowing which combination fits your income, credit profile, target neighborhood, and timeline is where the real work happens — and that's where I come in.

I work with Denver-area first-time buyers across the CHFA, metroDPA, and federal loan landscape. If you're trying to figure out which programs you qualify for, whether stacking makes sense for your situation, or how to position an offer in a market where buyers are negotiating below list price, I'll do a 30-minute program-fit review with you — no commitment. We'll look at your target price range, your current savings, and which assistance combinations are realistic given your timeline.

Reach out at pmccoy626@gmail.com or (319) 325-0668 to set it up. Come with your target neighborhoods and price band; I'll come with current program limits and a clear picture of what's available to you.

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Paul McCoy, Realtor | Fathom Realty | License #: FA.100105533 | (319) 325-0668 | pmccoy626@gmail.com

Paul McCoy is a licensed real estate professional in Colorado. Equal Housing Opportunity.