South Carolina first-time homebuyer grants and down payment assistance (2026)

Two year-round SC Housing loans and what changed in 2026

The SC Housing Homebuyer Program pairs a 30-year fixed first mortgage (FHA, VA, USDA or conventional) with a $10,000 second mortgage. The $10,000 can pay the down payment, closing costs and prepaid items, including single-premium mortgage insurance on conventional loans. It cannot cover an appraisal gap or a real estate commission. Buyers who skip the assistance get a lower first-mortgage rate ⁠²⁠³. SC Housing does not allow discount points or temporary buydowns. Lenders may charge an origination fee of up to 1%, and the only cost allowed on the second mortgage is a recording fee of up to $35 ⁠².

Palmetto Home Advantage offers 0%, 3% or 4% of the total first mortgage, including any upfront FHA premium or USDA/VA fee. It works with conventional loans (Fannie Mae HFA Preferred and Freddie Mac HFA Advantage, up to 97% loan-to-value) and with FHA, VA and USDA loans ⁠⁵⁠⁶. Move-up and repeat buyers are eligible. You cannot own more than two financed homes, counting the one you are buying ⁠⁵.

Three things changed in 2026. The statewide Palmetto Home Advantage income limit rose to $140,000 on the 2026-27 chart. SC Housing’s February guide had used $135,750 ⁠⁴⁠⁵. The SC Mortgage Tax Credit ended on June 30, 2026 ⁠⁹. And Palmetto Heroes ran for less than a month (see below) ⁠¹⁰.

Targeted and non-targeted counties: where you buy sets the first-time rule

Palmetto Home Advantage has no first-time rule. The Homebuyer Program’s rule depends on the county ⁠²⁠⁵:

• 12 non-targeted counties: Aiken, Anderson, Charleston, Greenville, Greenwood, Lancaster, Lexington, Oconee, Pickens, Richland, Spartanburg and York. You must not have owned a home in the three years before closing. Veterans discharged other than dishonorably get a one-time waiver.
• The other 34 counties (targeted): You may have owned a home in the past three years. You just cannot own one, including a mobile home taxed as real property, on the day you close. Owning vacant land is fine.

All borrowers must be U.S. citizens or permanent residents with a green card. SC Housing does not allow co-signers, non-occupant co-borrowers or a non-borrowing spouse on the title ⁠². Lenders collect IRS tax transcripts for every borrower. Non-targeted counties need three years of transcripts and targeted counties need the most recent year ⁠².

2026-27 income and home price limits by county

Homebuyer Program income counts everyone on the loan application or the deed. The limits apply to reservations made on or after June 1, 2026 and stay in place until HUD releases its 2027 figures ⁠²⁠⁴:

Scroll the table sideways to see every column.

The chart says the same limits apply to the now-closed MCC. Palmetto Home Advantage uses one $140,000 limit statewide, for any household size and any loan type ⁠⁴. It counts only the qualifying income on the loan application, including overtime, bonus and commission, not the whole household’s income ⁠⁵.

To check a county, ask the lender for SC Housing’s current chart. The program guide says limits can change without notice and are posted in Lender Online ⁠². SC Housing’s own pages showed different Palmetto Home Advantage figures during 2026 ($135,750 in April, $137,500 in May), so confirm the number on the day you reserve ⁠¹⁠⁶.

How the $10,000 and the 3%-4% seconds are forgiven or repaid

Both assistance loans are 0% second mortgages with no monthly payment. Forgiveness happens all at once at the end of the term, not a little each year ⁠³⁠⁵:

• Homebuyer Program, 15 years (180 months). If you sell, refinance or stop living in the home before month 180, you repay the entire balance. If you move out but keep the home, you must notify SC Housing, and the balance is due within 30 days of notice ⁠³.
• Palmetto Home Advantage, 10 years. The same rule applies: you repay it in full on a sale, refinance or move-out before maturity ⁠⁴⁠⁵.

SC Housing never subordinates either second mortgage. To refinance the first mortgage, you have to pay off the assistance ⁠²⁠⁵. Homebuyer Program loans are also subject to federal recapture tax if you sell within the federal window. SC Housing reimburses any recapture tax you have to pay to the IRS ⁠²⁠³.

Credit, debt ratio and underwriting limits SC Housing enforces

• Homebuyer Program: a 640 minimum middle score, or a higher insurer minimum. DTI may not exceed 45%. Manual underwriting and manual downgrades are not allowed, so the file needs an automated approval. Tax payment plans are allowed if the balance is $5,000 or less and three payments have been made. A past foreclosure on an SC Housing loan disqualifies you ⁠²⁠³.
• Palmetto Home Advantage: 640 minimum, or 660 for manufactured homes and FHA manual downgrades. DTI is capped at the lesser of 50% or the automated approval. FHA manufactured homes are capped at 45% and FHA manual downgrades at 43% ⁠⁵.
• Education (both): At least one borrower must finish a course within 12 months before closing, even after owning a home before. Fannie Mae’s HomeView and Freddie Mac’s CreditSmart (both online), mortgage insurer courses, and courses from HUD-approved counseling agencies all qualify. Buyers with a disability or no internet access can be referred to a HUD-approved agency for in-person or phone education ⁠²⁠³⁠⁵.

Palmetto Heroes, the MCC sunset and the community lending add-ons

Palmetto Heroes is an annual round for teachers, nurses, law enforcement and corrections officers, firefighters, EMTs, paramedics, veterans, active-duty military and National Guard members. The 2026 round paid $10,000 in forgivable assistance with a low fixed rate. It opened March 16 and closed April 13, 2026, after 272 loans used up the funding, its fastest sellout yet. SC Housing says to watch for the 2027 round in spring 2027 ⁠¹⁠¹⁰.

SC Mortgage Tax Credit. SC Housing’s MCC gave a federal tax credit of up to $2,000 a year for a $500 fee. It took its last reservations at 6:00 p.m. on June 30, 2026, and the Palmetto Home Advantage options that included an MCC ended with it. The state no longer offers an MCC ⁠⁹.

SC Housing also runs four Community Lending Initiatives on top of the Homebuyer Program, for FHA, USDA and VA loans only ⁠²⁠⁸:

• County First: a reduced fixed rate in 29 rural counties, among them Abbeville, Allendale, Bamberg, Barnwell, Beaufort, Chesterfield, Georgetown, Orangeburg and Williamsburg. You cannot own a home at closing, and the Homebuyer Program’s income and price limits apply ⁠⁷.
• Families with Disabilities: No first-time restriction if a household member has a permanent 100% disability documented by SSI, SSDI or long-term disability income ⁠².
• First-Generation Homebuyer: For first-time buyers whose parents did not own a home. You sign a certification when you apply ⁠²⁠⁸.
• Housing Choice Voucher Homeownership: FHA financing with forgivable assistance for voucher holders in an approved housing authority homeownership program ⁠¹⁠⁸.

Local help in Richland County, Greenville County and Charleston

• Richland County Homeownership Assistance Program (RCHAP). Up to $24,500 for down payment, closing costs or principal reduction. It is a deferred forgivable second mortgage with a 5-year lien period under $15,000 or a 10-year period from $15,000 up. If you move out early, you repay a prorated amount. It covers unincorporated Richland County and Blythewood. The 2026 income limit is $73,900 for four people ($51,750 for one, $97,550 for eight). The price cap is $228,000 for an existing home and $273,000 for new construction, and homes must be built after 1978. You need HUD-certified counseling and $500 of your own money. The county was holding monthly workshops through October 2026 and says review takes up to 30 business days ⁠¹².
• Greenville County Redevelopment Authority (GCRA). GCRA builds and sells affordable homes, such as the Fairview Townhomes in Greer, to first-time buyers. Its income limits, effective June 1, 2026, are $85,050 for four people in Greenville County. GCRA does not publish a down payment assistance amount online; call (864) 242-9801 ⁠¹³.
• City of Charleston Homeownership Initiative. This is not cash assistance. The city sells homes it has subsidized, under a 90-year affordability covenant, to buyers at 50% to 120% of AMI who have not owned a home in three years ⁠¹⁴. In April 2026, six Juniper Street townhomes in West Ashley were priced just under $289,000 after a $60,000 city subsidy, with $2,500 earnest money and a homebuyer workshop required. Applications are first-come through the city’s Neighborly portal ⁠¹⁵.

Getting an SC Housing loan through a participating lender, step by step

1. Choose between the two products

   If you are buying in a non-targeted county and owned a home in the last three years, Palmetto Home Advantage is usually your only SC Housing option. The exceptions are veterans and households under the Families with Disabilities rule ⁠²⁠⁵.

2. Check your county’s figures

   Compare your household income and target price with the June 1, 2026 chart above, or with $140,000 of qualifying income for Palmetto Home Advantage ⁠⁴.

3. Finish homebuyer education

   HomeView or CreditSmart can be done online, and the certificate is valid for 12 months ⁠²⁠⁵.

4. Find a participating lender

   Use SC Housing’s Find a Lender page and pick your county. The agency listed PrimeLending, Lower (DBA Premier Nationwide) and Guild Mortgage as its top three lenders ⁠¹¹.

5. Gather documents

   Expect pay stubs, W-2s and bank statements. You also need IRS transcripts (three years in non-targeted counties), a green card if you are not a citizen, a DD-214 for the veteran waiver, and SSI, SSDI or disability-income proof for the Families with Disabilities rule ⁠².

6. Sign a contract, then lock

   The lender reserves funds only after you have a signed sales contract. Existing homes must close within 60 days of the lock and new construction within 120 days ⁠³.

7. Close, then keep the paperwork

   SC Housing issues a Certificate of Eligibility before closing. Keep the second-mortgage note and any recapture notice for when you sell or refinance ⁠³.

If a lender turns you down, you can apply with another participating lender. For help, call SC Housing at 803.896.2211 or email [email protected] ⁠¹⁰. Other states’ programs are on the first-time homebuyer grants page, and more South Carolina guides are on the South Carolina page.