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Connecticut Housing Finance Authority


Program Overview
The Downpayment Assistance Program (DAP) offers supplementary loans at below-market interest rates to eligible borrowers of home loans who are unable to raise sufficient funds to pay the upfront expenses associated with purchasing a home.

Please note: A DAP loan is not intended to finance the purchase of a home. Because CHFA recognizes that the foremost obstacle to homeownership is a potential homebuyer’s inability to cover the down payment and closing costs of a home purchase, DAP loans can be used in conjunction with CHFA home loans. An eligible borrower must show his or her ability to repay the primary mortgage and the DAP loan in order to qualify for assistance under this program.

Downpayment Assistance Program Interest Rates
In most cases, the DAP interest rate will match the interest rate of the borrower’s first mortgage (up to 6 %.) However some borrowers under the Homeownership Program, the Home of Your Own Loan Program, the Police Homeownership Mortgage Program and the Section 8 Housing Choice Voucher Homeownership Program may be eligible for a lower interest rate.


Who can apply for a Downpayment Assistance Program loan?
Any borrower who qualifies for a CHFA first mortgage can also apply for a DAP loan of at least $3,000. Generally, borrowers must demonstrate that they have sufficient income to pay both loans but lack sufficient savings to afford a down payment and/or the closing costs on the home. In addition, the applicant must be able to afford the $200 application fee for the program and must also attend a free 3-hour homebuyer education class before closing on the loan. (See, homebuyer education for class schedules.)


How much Downpayment Assistance can you receive?
The minimum DAP loan amount is $3,000 and the maximum is 25 % of the purchase price of the home.


What else should you know about a DAP loan?
Loan amounts may vary.
While the minimum DAP loan amount is $3,000, the actual down payment required might exceed this sum depending upon the purchase price of the home. Typically, at least 3.5 % of the total purchase price of a home is required for a down payment. (This is determined by the mortgage insurer.)

Loan eligibility may depend on household savings.
DAP applicants are required to use all liquid assets or household savings above $5,000 towards a down payment. This requirement does not apply to borrowers under the Police Homeownership Program and the Teachers Mortgage Assistance Program. Retirement savings accounts are considered liquid if the Plan allows borrower(s) to borrow or withdraw funds for the purpose of purchasing a new home. Only the amount of funds in any retirement plan, including but not limited to IRA Accounts and 401K Plans, in excess of ten thousand dollars ($10,000) will be included in the asset test calculation. Retirement accounts with $10,000 or less will be excluded from the asset test even if the plan allows for borrowing or withdrawing funds for the purchase of a new home.

An application fee is required.
There is a $200 application fee for a DAP loan.

You will need to complete a homebuyer education class.
Under this program, a borrower must attend a free three-hour homebuyer education class before closing on the loan. Classes are held at several locations in the state each month. (See, homebuyer education class schedules.)

Other down payment assistance may be available from your town or city.
Some towns and cities provide down payment assistance in the form of low interest loans or grants to eligible residents. Prospective homebuyers should inquire with their local Department of Economic and Community Development to investigate whether this assistance is available.


How do you apply for a Downpayment Assistance Program loan?
To be eligible for a DAP loan, borrowers must apply and qualify for a CHFA first mortgage. To apply for a Downpayment Assistance Program loan, prospective borrowers should contact one of CHFA’s Participating Lenders for guidance through the loan application process. Generally, the entire loan process takes between six and eight weeks.


Questions? Contact CHFA.
Prospective borrowers should first contact their lender for information on this loan program. For additional assistance, borrowers may contact CHFA’s single family underwriting department.

Phone: (860) 571-3502
Fax: (860) 571-3550

Mailing Address:
Attn: Single Family Underwriting
999 West Street
Rocky Hill, CT 06067-4005