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

Home Advantage DPA: 0% money without a first-time rule

Home Advantage DPA pays 3%, 4% or 5% of the first mortgage’s gross loan amount, rounded down to the dollar. The 5% option is available only on FHA and conventional loans ⁠⁵. You may take less than the maximum. There is no needs test and no reserve limit ⁠⁵. The loan carries 0% interest and a 30-year term, and you make no monthly payment. It is due in full when you sell, transfer or refinance, pay off the first mortgage, or stop living in the home ⁠⁵.

The trade-off is the interest rate on the first mortgage. On WSHFC’s Oct. 19, 2026 rate sheet, a Home Advantage FHA, VA or USDA loan was priced at 7.875% with 3% assistance and 8.125% with 4%, both with a 1% origination fee. With no origination fee, the rate was 8.625% at 4% and 8.75% at 5% ⁠¹¹. A House Key Opportunity FHA, VA or USDA loan was 6.875% that day ⁠¹¹. Rates are posted every business morning and change without notice ⁠¹¹.

When House Key Opportunity and its county limits apply

House Key Opportunity is for buyers who have not owned and lived in a home in the last three years. Buyers in a federal Target Area and veterans are exempt from that rule ⁠⁷. Lenders check the last three years of tax returns and credit reports for mortgage interest or property-tax deductions ⁠⁷. Income counts the projected income of everyone 18 or older who will live in the home, whether or not they are on the loan ⁠⁴. Because the loan is bond-funded, a federal recapture tax can apply if you sell within nine years at a gain after your income has risen above set limits. The tax is capped at 50% of the gain or 6.25% of the original loan, whichever is less ⁠⁷.

Scroll the table sideways to see every column.

To check whether an address is in a Target Area, look up its census tract code and search for it on the WSHFC Target Area map ⁠⁸.

House Key cannot be used with Home Advantage DPA. A House Key buyer must use a specialty WSHFC program or an approved community second loan, unless the home is never-occupied new construction or in a community land trust ⁠⁴. The usual pairing is Opportunity DPA: up to $15,000 at 1% simple interest, deferred for 30 years ⁠¹. Its June 8, 2026 income limits are lower than House Key’s. They are $93,350 for 1-2 people and $116,650 for 3 or more in King and Snohomish counties. In Clark, Kitsap, Pierce and Skamania they are $83,000 and $103,700. In Thurston and Whatcom they are $78,600 and $98,250, and in all other counties $67,450 and $84,300 ⁠⁸.

Needs-tested programs and the 25% housing-cost test

Five WSHFC programs size the loan to your actual cash shortfall. The lender completes a Needs Assessment Form, and you may keep the greater of 12 months of house payments or $20,000 in liquid savings ⁠³:

• Home Advantage Needs-Based DPA: up to $10,000 at 1%. Income can be up to $164,400 in King and Snohomish or $126,800 elsewhere (rev. June 8, 2026). Veterans skip the needs test ⁠⁶.
• HomeChoice DPA: up to $15,000 at 1% for a borrower with a disability, or with a disabled family member living in the home. It has the same income limits, requires first-time status unless you buy in a Target Area, and adds a one-on-one counseling session ⁠¹⁠³.
• Veterans Downpayment Assistance Program: up to $10,000 at 3% for veterans buying their first home or in a Target Area. A DD-214 or similar document is required ⁠¹⁠³.
• ARCH (East King County): up to $30,000 at 4% in 15 cities, including Bellevue, Redmond, Kirkland and Sammamish. Price caps are $646,000 for an existing home and $660,000 for new construction. Income runs from $81,700 for one person to $154,000 for eight, and you must put in 2% of your own money ⁠¹⁠³.
• Bellingham Downpayment Assistance Program: up to $40,000 at 3% for first-time buyers inside city limits. Price caps are $667,850, or $375,250 for a condo. Income runs from $66,720 for one person to $125,850 for eight, and you must contribute the greater of $2,500 or 1% ⁠¹⁠³.

If your house payment would be less than 25% of your income, the Commission will not fund more than the minimum required down payment (3.5% on FHA). The needs-tested programs then shrink or disappear ⁠⁶⁠³.

The Covenant Homeownership Program’s waitlist and forgiveness rule

The Covenant program was created by the 2023 Covenant Homeownership Act. It is funded by a $100 fee on recorded real estate documents ⁠⁹. At least one buyer, or that buyer’s parent, grandparent or great-grandparent, must have lived in Washington before April 11, 1968. That person must be Black, Hispanic, Native American or Alaska Native, Native Hawaiian or Pacific Islander, Korean, or Asian Indian ⁠⁹⁠¹⁰. All borrowers must be first-time buyers. That includes single parents and displaced homemakers who owned a home only with a former spouse ⁠¹⁰.

The loan covers up to 20% of the lower of the price or appraised value, capped at $150,000, plus the closing costs you pay. It carries 0% interest and is due at sale, refinance or year 30. There is no purchase price limit when it is paired with Home Advantage ⁠¹⁰. A 2025 amendment, H.B. 1696, added forgiveness. If your income was at or below 80% of your county’s AMI when the loan was made, the loan is forgiven automatically five years and one month after closing. You must still live in the home and be current on the first mortgage ⁠¹⁰. The county income limits effective June 8, 2026 run from $114,950 in Asotin County to $197,300 in King and Snohomish counties. They are $152,750 in Pierce, $153,950 in Clark and $132,600 in Spokane ⁠⁹.

Demand now exceeds the monthly funding. Since April 20, 2026, your lender must submit your family history documents, education certificate and underwriter-signed pre-approval to the Commission before you look for a home. When funds open up, you have 30 days to go under contract and reserve the money. If you miss that window, you go to the end of the list ⁠¹⁰.

Credit scores, DTI and lender rules

WSHFC sets no credit score floor of its own. Each borrower must meet the minimum for the loan type, set by FHA, VA, USDA, Fannie Mae or Freddie Mac ⁠². Fannie Mae requires a 620 score on manually underwritten fixed-rate loans. Its automated Desktop Underwriter has no fixed minimum, but WSHFC requires an “Approve/Eligible” finding ⁠¹³⁠². Debt-to-income is capped at whatever the automated underwriting approval allows. Manual underwriting is limited to certain FHA, VA, USDA and Fannie Mae files, and is not allowed on Freddie Mac HFA Advantage ⁠². Ask your loan officer for their company’s minimum score, since lenders can set their own.

You must work with a Commission-trained loan officer. WSHFC lists about 60 participating lenders that closed at least five of its loans in the past 12 months, but not every loan officer at those companies is trained ⁠¹. You cannot hold a Commission loan while getting another one. Existing Home Advantage, House Key or Covenant loans must be paid off first ⁠².

Mortgage credit certificates. WSHFC’s current homebuyer pages do not offer new MCCs. Its MCC page only reissues certificates for existing holders who refinance, for a $375 fee ⁠¹²⁠¹.

Seattle and Tacoma city money

• Seattle. The Office of Housing funds up to $76,000 per household for homes inside Seattle city limits. You apply through partner nonprofits: HomeSight, Parkview Services, Habitat for Humanity Seattle-King County and Homestead Community Land Trust. Buyers must be first-time (no ownership in 3 years). The income limits effective May 15, 2026 are $92,080 for one person, $131,520 for four and $173,680 for eight. You also need a city-approved class and one-on-one counseling from HomeSight or Parkview. HomeSight and Parkview make the assistance as low-interest loans; Parkview’s are deferred. The city notes that its older Seattle Downpayment Assistance Program is no longer offered through WSHFC ⁠¹⁴.
• Tacoma. The Down-payment Assistance Program made 0% deferred 30-year loans of up to $80,000 with state Housing Trust Fund money. As of Oct. 20, 2026, the city says all funds are committed and it is not taking applications ⁠¹⁵.

From class certificate to closing, step by step

1. Take the WSHFC class

   Classes are free, in person or virtual, and last about five hours. Every borrower on the note gets their own certificate, valid for two years. If you can’t attend, the eHomeAmerica course is $50 and takes 6-8 hours. Certificates from Framework, CreditSmart or mortgage insurers are not accepted ⁠².

2. Pick a Commission-trained loan officer

   Use the Find a Lender page. Ask which WSHFC down payment programs they have closed ⁠¹.

3. Check your limits

   Use the $215,000 Home Advantage cap, the House Key county table or the Covenant county list. Check for a Target Area if you are near a limit ⁠⁸⁠⁹.

4. Gather documents

   You need pay stubs, bank statements, three years of tax returns for House Key and specialty programs, a DD-214 for the veterans program and, for Covenant, pre-1968 family records ⁠²⁠⁷⁠¹⁰.

5. Get pre-approved and reserve funds

   The lender reserves the first mortgage and the down payment loan on a first-come basis once you have a certificate. Covenant buyers wait for written authorization first ⁠²⁠¹⁰.

6. Close and keep the paperwork

   Keep the second-lien note and any recapture tax notice. Your DPA balance comes due at sale or refinance ⁠⁵⁠⁷.

If a lender says no, another participating lender can review the file. Buyers who are not ready for a mortgage can get free counseling through the hotline at 1-877-894-4663 ⁠⁹. Other states’ programs are compared on the first-time homebuyer grants page.