Washington First-Time Homebuyer Assistance Programs

With outdoor beauty, major companies like Amazon and Microsoft and no state income tax, Washington continues to welcome new residents. In fact, more people have moved into the state than out of it over the past three decades, according to the Washington State Office of Financial Management.

That influx can spell difficulties for first-time homebuyers, but all isn’t lost. The Washington State Housing Finance Commission works with mortgage lenders to offer a range of programs to help first-time buyers. The state’s definition of a first-time homebuyer allows some leeway, too: someone who hasn’t owned and occupied a primary residence in the last three years.

Washington first-time homebuyer loan programs

The Washington State Housing Finance Commission (WSHFC) oversees two primary first-time homebuyer mortgage programs, Home Advantage and House Key Opportunity, both of which can be applied to a conventional, FHA, VA or USDA loan. To qualify, you’ll need to complete a five-hour homebuyer education course and meet other program requirements.

WSHFC Home Advantage

The Home Advantage program can help Washington first-time homebuyers qualify for a low interest rate.

• Requirements
  

  • Annual income under $180,000
  • Must meet program’s minimum credit score and maximum DTI ratio requirements
  • Completion of a homebuying educational seminar
  • Contact with a commission-trained loan officer to discuss eligibility
  • Residency requirements apply

• Pros and cons
  

  Pros

  • Open to both first-time and repeat homebuyers
  • Single-family units, townhomes, condominiums and manufactured homes are all eligible
  • Program assists with up to 4 percent of your down payment and also features a special interest rate

  Cons

  • Limited to an approved list of partner lenders
  • If you refinance the home, you’ll need to pay back any down payment assistance provided

WSHFC House Key Opportunity

House Key Opportunity is geared toward homebuyers with lower incomes who are also leveraging certain down payment assistance programs.

Like Home Advantage, the benefit of House Key Opportunity is a competitive interest rate, which is lower on FHA, VA and USDA loans. For a conventional loan, you’ll be able to qualify for a rate discount if your income is below 80 percent of the area median income (AMI). Here is a guide to the 80 percent limits by county.

• Requirements
  

  • Open to first-time buyers and those who have not owned in the last 3 years (for properties in target areas)
  • Must meet the income limit, ranging from $100,000 to $175,000, depending on household size and location
  • Home price cannot exceed $345,000 to $750,000, depending on the home’s location
  • Must borrow through a participating lender
  • Must complete a homeowner education course
  • Must purchase a new construction home, a home located in a community land trust or qualify for a select down payment assistance program
  • Must meet with a program-participant loan officer to determine mortgage eligibility

• Pros and cons
  

  Pros

  • Open to both first-time buyers and those who have not owned within the last three years and who are looking to buy in a target area
  • For FHA, USDA, VA and Fannie programs, higher balance loans are permitted in high-cost areas

  Cons

  • Cannot be combined with the mortgage credit certificate program
  • Program is only open to borrowers utilizing specific down payment assistance programs
  • Limited eligible property types

WSHFC EnergySpark

If you qualify for the Home Advantage program, you might want to explore buying a home that is especially eco-friendly or can be renovated to meet Washington’s green standards. If so, you could be eligible to take advantage of the EnergySpark program, which offers an additional discount on your interest rate.

• Requirements
  

  • Property must be a new home that exceeds Washington energy standards by at least 15 percent or an existing home that can be upgraded for 10 percent energy savings over its current use
  • Household income under $180,000
  • Completion of an energy assessment showing the most cost-effective upgrades for the home

• Pros and cons
  

  Pros

  • 0.25 percent interest rate reduction
  • With a more energy-efficient home, you’ll save more on utility bills

  Cons

  • Program has strict energy efficiency requirements for a home to be eligible
  • Limited to participating lenders

Washington down payment assistance and grants

Coming up with a down payment for a home in Washington can be daunting, but if you’re a first-time homebuyer, the state has a few options that can help. In fact, according to the WSHFC, the average homebuyer scores $10,000 in down payment assistance through the agency.

To qualify for the following assistance programs, you’ll need a minimum credit score of 620 and have to meet income requirements, which vary by program. You could also be eligible if you’re not a first-time buyer but purchasing in a specified “targeted area.”

Home Advantage Down Payment Assistance (DPA)

Combined with a Home Advantage first mortgage, this down payment assistance loan can provide up to 4 percent of the total amount of your mortgage (up to 5 percent if getting a conventional or FHA loan). A household income limit of $180,000 applies.

• Pros and cons
  

  Pros

  • Low interest of between zero and 4 percent
  • Payments are deferred until you move, transfer or pay off the property

  Cons

  • Availability is limited to participating lenders
  • Eventual repayment with interest (if it applies) is required

Home Advantage DPA Needs Based

Combined with a Home Advantage first mortgage, this program is for homebuyers making considerably less than the $180,000 income threshold. If your annual income is less than $115,900 (or $147,400 in King or Snohomish counties), you could be eligible for up to a $10,000, 30-year loan for your down payment needs. You’ll pay 1 percent interest on the loan but won’t repay the funds and interest until the loan term ends.

• Pros and cons
  

  Pros

  • Low interest rate
  • Payments are deferred until after the home is paid off
  • No need assessment is required for veterans to attain the $10,000 loan amount

  Cons

  • Eventual repayment is required
  • Fund availability subject to market rates and conditions

Opportunity DPA

This down payment assistance program, combined with the House Key Opportunity first mortgage, is a second mortgage of up to $15,000, with a 1 percent interest rate and 30-year deferred payments. Buyers must attend an educational course to qualify.

• Pros and cons
  

  Pros

  • Open to both first-time buyers or those purchasing in a target area
  • No payments are due during the deferral period, which can be up to 30 years

  Cons

  • Must utilize a participating lender
  • Must also qualify for the Opportunity first mortgage program

The income limits for the Opportunity DPA program, as of April 22, 2024, are much lower than the House Key Opportunity first mortgage and vary based on location and number of people in the household:

Veterans DPA

Veterans and their surviving and never-remarried spouses and dependent children can also qualify for up to $10,000 in down payment funds packaged as a second mortgage. The payments on the mortgage are deferred for 30 years, with an interest rate of 3 percent. The assistance can be combined with either the Home Advantage or House Key Opportunity first mortgage.

Household income limits do apply: $147,400 for King and Snohomish counties and $115,900 in all other counties across the state.

• Pros and cons
  

  Pros

  • Benefits may be extended to surviving spouses (never remarried) and dependent children of deceased veterans
  • Payments are deferred for up to 30 years at a low interest rate

  Cons

  • Cash back to borrowers isn’t allowed, regardless of how much you qualify to borrow
  • Must also qualify for one of the WSHFC first mortgage loan programs to be eligible

HomeChoice Disability DPA

If you or someone in your household is living with a disability, you might qualify for up to $15,000 in down payment assistance, also as a second mortgage. The second loan has a 1 percent interest rate and, like other down payment assistance, defers payments for 30 years. Income limits do apply– $147,400 for those buying property in King or Snohomish counties and $115,900 for those in other counties statewide.

• Pros and cons
  

  Pros

  • Available to borrowers with disabilities or for those who have a disabled family member living with them
  • Open to both first-time buyers and buyers purchasing in a target area

  Cons

  • Additional requirements may apply in addition to the disclosed income limits

BECU First-Time Homebuyer Grant

The Boeing Employees’ Credit Union (BECU) based in Washington, offers a first-time homebuyer grant of up to $8,000 for eligible BECU members. The home must serve as your primary residence and you’ll need to stay there at least three years.

• Pros and cons
  

  Pros

  • No repayment required
  • One-unit homes, condos and townhouses are all eligible
  • In addition to Washington state, the grant is available for homes purchased in Arizona, California, Idaho, Illinois, Kansas, Missouri, Oregon, Pennsylvania and South Carolina.

  Cons

  • Lower funding amount than DPA programs

City-specific homebuyer assistance programs

First-time homebuyers in Washington can also find help through local housing initiatives.

King County (area east of Seattle, including Bellevue)

Though the City of Seattle’s down payment assistance program has ended, funds are still available in the area via the ARCH East King County Downpayment Assistance Loan Program.

• Requirements
  

  • Home must serve as your principal residence and be owner-occupied
  • Home must be occupied within 90 days of sale
  • Requires completion of a homebuyer education seminar

• Pros and cons
  

  Pros

  • Open to both first-time homebuyers and qualifying repeat buyers
  • Both single-family units and condominiums within an ARCH member city may qualify (e.g. Bellevue, Bothell, Clyde Hill, Issaquah, Kenmore, Kirkland, Redmond)

  Cons

Spokane

SNAP operates an assistance program in its Spokane region designed to make homeownership more attainable for eligible buyers. Applicants may apply for a loan of up to 100 percent loan-to-value (LTV).

• Requirements
  

  • Program available to both first-time buyers and those who have been displaced for qualifying reasons, including divorce and financial difficulty
  • Homebuyer course and counseling are both required

• Pros and cons
  

  Pros

  • May be available for borrowers who have poor credit
  • Up to 100 percent of the property value may be financed

  Cons

  • Limited details available online; interested buyers will need to inquire with the local SNAP office and may need to qualify for SNAP benefits for eligibility

Tacoma

The City of Tacoma operates a down payment assistance program in partnership with the Tacoma Community Redevelopment Authority (TCRA). Applications are open through December 2025 or until funds have been exhausted. Assistance comes in the form of a 25-year, interest-free loan of up to $60,000.

• Requirements
  

  • Must fall within household income limits, which depend on family size
  • Must occupy the home as your primary residence
  • Home must be located within Tacoma city limits
  • Completion of a homebuyer education course

• Pros and cons
  

  Pros

  • Loan doesn’t accrue interest
  • Program has a goal of serving at least 65 percent Black households

  Cons

  • If your spouse or domestic partner has been a homeowner within the last three years, you’re ineligible for the program
  • Funds must be repaid if you move or sell the home before the loan term ends
  • Additional homebuyer education may be required if purchasing a home after July 1, 2025

Clark County (Vancouver, Washington area)

Clark County residents using a WSHFC mortgage (Home Advantage or House Key) may be eligible for Homebuyer Downpayment Assistance. The program offers up to $60,000 in down payment and closing cost assistance.

• Requirements
  

  • Application income of under $105,210
  • Property must be located within Clark County and have a purchase price of $600,000 or less
  • Must occupy the residence
  • Minimum credit score of 620 or higher
  • Completion of a homebuyer education class and a 1:1 prepurchase counseling session

• Pros and cons
  

  Pros

  • A 2 percent simple interest rate loan that’s deferred until you move, transfer, pay off or refinance the mortgage
  • Used in conjunction with qualifying mortgage loans (Home Advantage and House Key)

  Cons

  • Loan must eventually be repaid in full
  • Because funds were made available via the American Rescue Plan (COVID relief), this program will likely not be available on an ongoing basis

Other first-time homebuyer loan programs

While you’re considering first-time buyer programs in Washington, be sure to explore the variety of nationally available loan programs, too, including:

• FHA loans – If you have a lower credit score or limited savings, consider an FHA loan. These loans are widely available, have a minimum credit score of 580 and require a down payment as little as 3.5 percent.
• VA loans – If you’re a member of the military or a veteran, you could qualify for a VA loan, which doesn’t require a down payment.
• USDA loans – USDA loans don’t have a down payment requirement but are only available to borrowers buying in a USDA-eligible rural area. You typically need a credit score of 640 or higher to qualify.
• Good Neighbor Next Door program – This HUD program has a very low down payment requirement on homes in certain areas, coupled with the ability to save 50 percent on the purchase price.

Get started

Ready to move one step closer to your first home in Washington? As you prepare to become a first-time homebuyer, here are some next steps:

• Do your homework. As you sort through mortgage and down payment assistance options, you can fill out this form through the Washington State Housing Finance Commission to help determine which programs best fit your needs.
• Work on your credit score. It’s the most important factor in determining your mortgage rate, so focus on boosting your number.
• Compare lenders. You can use the WSHFC website to find loan officers to help you navigate the process. Each works for a lender that could have different interest rates and terms, so comparison and rate-shopping are key to securing a competitive loan.
• Shop for homeowners insurance. Because insurance can make a significant impact on your monthly budget, shopping local insurers is also a good way to prepare. Ask multiple companies for competing quotes to find a policy that best fits your needs.

• Explore other first-time homebuyer programs by state