Buying a home in Central PA, where the median price is $240,000, can be tough - especially with down payments ranging from $8,000 to $48,000. To make homeownership more accessible, here are 7 programs offering financial assistance:
- PHFA HOMEstead Loan: Up to $10,000, forgivable after 5 years.
- Keystone Advantage Loan: 0% interest, up to $10,000, forgives 20% annually.
- Access Down Payment Program: Up to $15,000 for accessibility upgrades, fully forgiven.
- First Front Door Grants: 3:1 matching grant, up to $5,000.
- Williamsport Buyer Support: Up to $10,000 or 10% of purchase price, forgivable over 5 years.
- PHFA New Home Construction Program: No-interest loans for new builds, forgivable after 5 years.
- City & County Programs: Local grants like Harrisburg’s $5,000 assistance.
Quick Comparison Table:
| Program Name | Max Assistance | Forgiveness Period | Key Features |
|---|---|---|---|
| PHFA HOMEstead Loan | $10,000 | 5 years | No-interest loan, PHFA-only |
| Keystone Advantage Loan | $10,000 | 5 years (20%/yr) | 0% interest, PMI waiver |
| Access Down Payment Program | $15,000 | Full forgiveness | For accessibility modifications |
| First Front Door Grants | $5,000 | 5 years | 3:1 matching structure |
| Williamsport Support | $10,000 | 5 years | Local income/property limits |
| New Home Construction | Varies | 5 years | For new builds in urban zones |
| City/County Programs | $5,000 | Program-specific | Local grants for specific areas |
These programs cater to different needs, like first-time buyers, accessibility upgrades, or urban development. Act fast - funding is often limited!
Pennsylvania Down Payment Assistance - First Time Home Buyer Programs in PA
1. PHFA HOMEstead Down Payment Loan
The PHFA HOMEstead Down Payment Loan provides a no-interest second mortgage of up to $10,000 [1]. This loan is designed to help with both down payment and closing costs, addressing the $8,000 FHA gap mentioned earlier. If you live in the home continuously for five years, the loan is completely forgiven [1][3].
Here’s what you need to qualify:
- Income limits based on your county
- Property price limits that vary by location
- Completion of a PHFA-approved homebuyer education course [2][8]
Keep in mind, homes built before 1978 (due to lead paint regulations) and properties in major metro areas are not eligible. This aligns with the challenges of Central PA’s median home prices discussed earlier [1][3].
The $10,000 second mortgage must be used with PHFA's Keystone mortgage [1]. While it can't be combined with other PHFA down payment assistance programs, it can be paired with accessibility modification loans through the Access Program if needed [7].
Because funding is limited each year, it’s distributed on a first-come, first-served basis through PHFA-approved lenders. Acting quickly is key, as the program relies on annual HUD funding caps [1][2].
2. Keystone Advantage Loan
If you're not eligible for the HOMEstead program due to location restrictions, the Keystone Advantage Loan might be a great alternative. It’s a second mortgage with 0% interest that offers up to $10,000 to help with down payment and closing costs [1][3].
To qualify in 2025, here's what you'll need:
- A credit score of at least 660
- Household income below $103,200 (for 1-2 person households in most Central PA counties)
- The property purchase price must be under $346,000 for single-family homes [2][3]
The loan is forgiven gradually - 20% each year over five years, as long as the home remains your primary residence [3]. For example, if you borrow $10,000, the balance decreases by $2,000 every year you stay in the home. However, if you sell or refinance before the five years are up, you’ll need to repay the remaining balance [1].
| Feature | Details |
|---|---|
| Maximum Assistance | $10,000 |
| Interest Rate | 0% |
| Forgiveness Period | 5 years (20% annually) |
| Minimum Credit Score | 660 |
| Required Contribution | $1,000 minimum from buyer |
With a price cap of $346,000, the program aligns with Central PA's median home prices, making it accessible to suburban buyers. While it doesn’t cover Dauphin County, it does include 90% of Central PA counties [1][2].
The program requires buyers to contribute at least $1,000 and meet the 660 credit score threshold, focusing on buyers with solid credit who need moderate help. One standout feature is the PMI waiver for loans with less than 20% down. For a $250,000 home in Lancaster County, this could save you around $150-200 per month in PMI costs. That’s a big help for households earning Central PA’s typical incomes of $64,000-$79,000 [3][4].
Since it works with conventional loans, this program is a great fit for buyers who want to avoid government-backed mortgages.
3. Access Down Payment Program
The Access Down Payment Program from PHFA offers a combination of financial support and accessibility upgrades, addressing challenges posed by Central PA's aging housing stock. This initiative helps buyers overcome both financial and physical hurdles to owning a home. Starting in 2025, the program provides no-interest loans of up to $15,000 for accessibility modifications and down payment assistance [3].
Unlike the Keystone Advantage's $10,000 limit, this program raises the cap to $15,000, specifically targeting accessibility needs. The best part? The loan is completely forgiven if the home remains your primary residence [2].
Here’s what you need to qualify in Central PA:
| Requirement | Details |
|---|---|
| Income Limit (4-person household) | $74,800 in Dauphin County |
| Property Requirements | Must comply with federal safety standards |
| Required Documentation | Medical certification of disability |
| First Mortgage Type | Must be a PHFA Keystone or Government Loan |
Common modifications include entrance ramps (around $1,500), widening doorways ($800-$2,000), installing grab bars in bathrooms ($200-$500), and adjusting kitchen layouts ($3,000-$5,000) [2][3].
One key benefit is the 45-60 day approval process, which covers both loan approval and planning for modifications [2][3].
However, keep in mind these Central PA-specific limitations:
- Modifications over $10,000 may require additional funding.
- Household income must stay within county limits.
- Annual funding is limited, so early application is crucial [1][2][3].
This program is especially helpful for buyers who need both financial support and accessibility upgrades, offering a unique solution for their needs.
4. First Front Door Grants
The First Front Door (FFD) program provides a 3:1 matching structure, where every dollar you save is matched with three dollars in assistance, up to $5,000. For example, saving $1,667 secures the full grant amount. This approach directly helps address Central PA's $8,000 FHA gap mentioned earlier [3].
The program includes a 5-year forgiveness period. To qualify in Central PA, you’ll need to meet these requirements:
- Be a first-time homebuyer (or not have owned a home in the past 3 years)
- Work with a PHFA-approved lender
- Stay within county-specific income limits
- Have a minimum credit score of 660, consistent with other PHFA programs [3]
Income limits are based on Central PA's median household earnings, which range from $64,000 to $79,000 [3][4].
One standout feature of FFD is that it works alongside PHFA first mortgages [2][3]. You can use tax refunds or work bonuses for your required contribution. Since funding is limited and awarded on a first-come basis, applying early is key.
"Front-load savings early in your home search and use tax refunds or bonuses for matched contributions", suggests PHFA counseling services [3].
Keep in mind, the property must be a single-family home and serve as your primary residence [1]. Applicants will need to submit bank statements to verify their $1,667 contribution [3].
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5. Williamsport Home Buyer Support
Williamsport's Community Development Department offers a focused down payment assistance program to support local homebuyers, providing up to $10,000 or 10% of the purchase price as a 0% interest deferred loan [1].
Income Limits for 2025
Eligibility is based on Lycoming County income limits:
- Single/two-person households: Up to $74,100
- Households with three or more people: Up to $85,215 [2]
The $74,100 limit for singles is slightly higher than Williamsport's median household income of $52,000 [3].
Property Price Caps
The program focuses on affordable housing with the following price limits:
| Property Type | Price Cap |
|---|---|
| Existing Homes | $150,000 |
| New Construction | $228,000 |
The $150,000 cap for existing homes ensures the program targets properties priced below the city’s median, which is lower than the $240,000 median for Central PA [3].
Qualification Requirements
To benefit from this program, buyers must:
- Meet Lycoming County income limits.
- Purchase a property within Williamsport city limits.
- Complete a HUD-approved homebuyer education course.
- Contribute at least $500 from personal funds.
- Have an income at or below 80% of the area median income [1].
Loan Forgiveness and Additional Assistance
The loan is forgiven over five years, following the same structure as the HOMEstead program. Buyers can also combine this assistance with PHFA's Access program to maximize support [10].
Applications are handled by Williamsport's Community Development Department. Partnering with local housing counselors who are familiar with the city’s market can make the process smoother [1].
6. PHFA New Home Construction Program
The PHFA New Home Construction Program focuses on building new homes to boost urban development. Unlike Williamsport's emphasis on existing homes, this initiative provides extra down payment assistance for buyers investing in new builds within revitalization zones [1].
Financial Assistance Details
The program offers a no-interest second mortgage with a five-year forgiveness term, as long as the property remains the buyer’s primary residence [1][3].
Income Limits for 2025
Income eligibility depends on the county:
| County | Family of 4 Income Limit | Single Person Income Limit |
|---|---|---|
| Dauphin | $112,400 | $78,680 |
| Other Central PA Counties | Varies by location | Contact your local office |
Property Criteria
To qualify, new construction homes must:
- Comply with federal safety standards [7]
- Adhere to local building codes [2]
- Be located in approved urban development zones [1]
- Be constructed by contractors certified by PHFA [9]
Application Requirements
Applicants need to meet the following criteria:
- A credit score between 620 and 680 [3]
- Completion of a homebuyer education course [3]
- Submission of construction-related documents [9]
Combining with Other Programs
This program can be paired with other PHFA options, like the Keystone Home Loan Program, to maximize assistance. By combining programs, first-time buyers in Central PA can make new construction homes more affordable [5][6].
7. City and County Programs
Cities and counties in Central Pennsylvania offer targeted help for down payments. For example, Harrisburg's First-Time Homebuyer Program provides $5,000, Lancaster City offers a matching package, and York focuses on urban development. Unlike broader state initiatives, these programs often zero in on specific neighborhoods, addressing the $8,000 FHA gap in targeted areas.
Program Requirements
To qualify for these local programs, you typically need to meet these criteria:
- A credit score of 640 or higher [3]
- Income below 80% of the area's median income [1]
- Completion of a HUD-approved homebuyer education course [2]
- A property inspection that meets HUD Housing Quality Standards [1]
Funding Comparison Table
| City/County | Maximum Assistance | Income Limit (Family of 4) |
|---|---|---|
| Harrisburg | $5,000 | $71,900 |
| Lancaster | $5,000 | $74,500 |
| York | $5,000 | $69,800 |
Application Process
Applications are handled through approved lender networks, which helps speed up the approval process [1]. Local housing authorities usually work with established lending partners to distribute funds efficiently.
Combining Benefits
In many cases, these local programs can be combined with state-level assistance. This approach, similar to Williamsport's program, can make a big dent in upfront costs [5].
Important Considerations
These programs come with specific rules tied to location, including:
- Properties must be in designated improvement zones.
- Buyers often face extended residency requirements of 7 to 10 years.
- Applicants may need to provide quarterly income verification during the process.
These restrictions focus the benefits on neighborhoods most impacted by the region's $240,000 median home prices. Keep in mind, the availability of funding depends on annual allocations [1][5].
Program Comparison
When deciding between these programs, focus on three main factors: financial impact, timeline requirements, and property eligibility. This breakdown helps buyers find the best fit for their needs.
Eligibility Requirements
Most programs typically require:
- A credit score of 660 or higher
- Income limits based on the county
- The property must be a primary residence
Property Restrictions
Here are some common property limitations:
- Homes built before 1978 may have restrictions
- Specific location zones may apply
- Properties must meet safety standards
Processing Timelines
Approval times can vary: PHFA programs take around 45 days, while local programs that require education may take 60+ days. In Central PA's competitive market, longer approvals could mean missing out on a property.
Some programs, like the 5-year forgiveness models, are structured similarly to the HOMEstead and Williamsport programs, while certain local initiatives extend requirements to encourage long-term community involvement.
Program Variations
| Program Name | Maximum Assistance | Type | Forgiveness Timeline |
|---|---|---|---|
| PHFA HOMEstead | $10,000 | No-interest loan | 20% annually over 5 years |
| Access Down Payment | $15,000 | No-interest loan | Based on occupancy |
| First Front Door | $5,000 | 3:1 matching grant | Fully forgiven after 5 years |
| Keystone Advantage | Up to 4% or $6,000 | 0% loan | 10-year repayment |
| City/County Programs | $5,000 (varies) | Grant/Loan | Program-specific |
Next Steps
If you're ready to move forward with these programs, here's how to get started:
Initial Preparation
- Check your eligibility: Make sure your credit score is at least 660, your household income falls within your county's limits, and you qualify as a first-time homebuyer. Keep in mind that Central PA's median home price is around $240,000 [1][2].
- Gather documents: You'll need pay stubs, tax returns, bank statements, and a valid ID [1].
Connect With Approved Professionals
Reach out to PHFA at 1-855-U-Are-Home to find a list of approved lenders. You can also work with PHFA-certified real estate professionals who are familiar with these programs and can help you incorporate them into your home-buying plan [2][3].
Managing the Timeline
Here’s a breakdown of how long each step might take:
- Pre-approval: About 1 week
- Homebuyer education: Around 2 weeks
- Property approval: 1 week
- Final underwriting: 3 to 4 weeks [1]
Common Pitfalls to Avoid
Keep an eye out for these potential issues:
- Choosing a property that doesn’t meet the program’s requirements
- Ignoring limits on closing costs set by the program [1]
Staying Compliant After Approval
Once you’ve secured assistance, make sure to:
- Use the property as your primary residence
- Notify your lender if you change your address [2]
Local Resources for Support
Need extra help? Here are some local resources:
- NeighborWorks America affiliates: Offer free counseling in Dauphin and Cumberland counties [7].
- County housing authorities: Some, like Harrisburg, provide grants (e.g., $5,000) [11].
- PHFA-approved housing counselors: Provide free homebuyer education courses [1].
For more details, consult PHFA-certified professionals who can guide you through combining different program benefits effectively.
FAQs
How do I buy a house with no money down in PA?
In Central Pennsylvania, there are two main ways to purchase a home without a down payment:
- VA Loans: These loans are available to veterans, active service members, and eligible surviving spouses. They provide 100% financing, meaning no down payment is required [1]. You'll need VA eligibility documentation and must work with a VA-approved lender.
- USDA Loans: Designed for properties in USDA-eligible rural areas, these loans allow low to moderate-income buyers to purchase homes with 0% down [5]. Areas like Perry, Juniata, and parts of Dauphin County often qualify for this program.
Both of these federal loan programs can be paired with Pennsylvania Housing Finance Agency (PHFA) assistance options, such as the Keystone Advantage Loan, for eligible buyers.
Things to keep in mind:
- Homes must meet specific safety and condition standards for these programs.
- USDA loans have income limits based on the county.
- You’ll need to work with approved lenders for both VA and USDA loans.
What is the $10,000 grant for first-time home buyers in PA?
While Philadelphia offers the Philly First Home Program, Central Pennsylvania has its own options for first-time buyers:
- Harrisburg Grants: Provides $5,000 in assistance [11].
- Access Program: Offers up to $15,000 for homebuyers with disabilities [10].
Key details:
- PHFA-approved homebuyer education is required [2][3].
- Income limits typically range from $64,000 to $79,000 for most households in Central PA [3][4].
- The property must be your primary residence.
To maximize your benefits, you can combine these local grants with PHFA programs like HOMEstead or Access.
