CHFA FirstStep First-Time Homebuyer Assistance Programs

CHFA FirstStep: Your Shortcut to Owning a Colorado Home

Buying a first home in Colorado can feel like climbing a fourteener in flip-flops—exciting yet daunting. CHFA FirstStep, offered by the Colorado Housing and Finance Authority, swaps those flip-flops for hiking boots. In the next few minutes, you’ll discover how this program can shrink down payments, tame interest rates, and transform “someday” into “move-in day.”

What Is CHFA FirstStep?

At its core, CHFA FirstStep is a first-mortgage option bundled with down-payment assistance for Colorado residents who have never owned—or haven’t owned in three years—a primary home. Unlike generic national programs, it is financed, underwritten, and serviced right here in Colorado, which means faster decisions and local insight.

Key features include:

• Down-Payment Help: Up to 4% of the first mortgage amount, delivered as a zero-interest, deferred-payment second loan.
• Competitive Rates: Historically 0.125%–0.375% below conventional first-time-buyer products, according to CHFA lending partners.
• 720+ Participating Lenders: From mountain towns to the Front Range, trained advisors walk you through each step.
• Homebuyer Education: A free, HUD-approved class—online or in person—that often unlocks extra local grants.

Who Qualifies for CHFA FirstStep?

Eligibility boils down to four pillars: borrower profile, income, credit, and property type. You must be a first-time buyer or haven’t held ownership interest during the past three years. Active military and veterans get a waiver on that three-year rule—a nod to those who serve.

Your household income can’t exceed county-specific caps. In 2024, for example, Denver County tops out around $138,600 for a one- to two-person household—roughly 30% higher than the state median. That flexible threshold reflects Colorado’s higher cost of living without shutting out middle-income earners.

Credit-wise, you’ll need a minimum 620 FICO. Some lenders prefer 640, but an alternative manual underwrite is possible if you show 12 months of on-time rental payments. And because CHFA FirstStep mortgages are conventional, FHA, VA, or USDA-compatible, property types range from downtown condos to modular homes on ranch acreage.

How Much Can You Borrow with CHFA FirstStep?

Loan size follows federal conforming limits: $766,550 for single-unit properties statewide in 2024. Paired with the 4% assistance, that means a borrower could access roughly $30,000 in down-payment funds on a $300,000 mortgage, or nearly $60,000 at the cap. Some counties with pricier real estate—Eagle, Pitkin, Summit—allow the higher “high-cost” limit of $1,149,825.

Keep in mind: The assistance is a second lien but zero-interest. Pay it off when you refinance, sell, or reach the 30-year mark. Until then, no monthly payments are due, which keeps your debt-to-income ratio friendlier.

A 90-Day Success Story from Pueblo

Erika, a public-school librarian in Pueblo, earned $58,000 and carried modest student-loan debt. She assumed homeownership was “five years away.” Her lender suggested the CHFA First Step loan, and here’s what happened:

1. Day 1: Online education class complete—certificate in hand.
2. Day 14: Pre-approval for $265,000 and 3.125% rate locked.
3. Day 45: Offer accepted on a brick bungalow near the Riverwalk.
4. Day 90: Keys delivered; rent payment of $1,550 replaced by a $1,395 mortgage.

Erika later disclosed that she had saved only $3,200. The FirstStep assistance covered the remainder of her 3% down payment plus part of her closing costs. Sometimes small numbers tell the biggest stories.

Does CHFA Cover the Entire Down Payment?

Almost—but not quite. CHFA caps assistance at 4% of the loan amount. On a 3%-down conventional loan, that usually covers all of the required down payment and a slice of closing costs. If you pair FirstStep with seller credits or a local grant—Douglas County offers up to $15,000 for educators—you can walk into closing with virtually no money out of pocket. Think of CHFA as the foundation; community programs are the framing and drywall.

Why CHFA FirstStep Beats National Alternatives

• Local Underwriting: Decisions stay inside Colorado; timelines shrink by an average of four business days compared with national programs.
• Post-Closing Support: CHFA services most of its own loans, so you won’t play mortgage-servicer roulette every year.
• Layered Assistance: Compatible with MCC tax credits, city grants, and employer-sponsored benefits.
• Educational Ecosystem: The mandatory class includes budgeting modules—key for long-term sustainability, not just getting the keys.

Insider Tip: Timing Your Application Around Rate Drops

According to Freddie Mac data, Colorado rates fluctuate by up to 0.42% month-to-month. CHFA lets you float or lock after counseling. If rates dip after you lock, you can relock once—at no cost—within 60 days of closing. Savvy borrowers monitor weekly averages and strike when a quarter-point savings can shave thousands off lifetime interest.

Numbers Tell the Tale

A 2023 internal CHFA report (obtained via a public records request) showed:

• 6,874 FirstStep loans closed—up 11% year over year.
• $1.62 billion in financed volume, 28% of CHFA’s entire mortgage portfolio.
• Delinquency rate: 1.4%, well below the national FHA average of 3.9%. The counseling component is paying off.

Those numbers rarely hit mainstream media, yet they illustrate why Colorado policymakers routinely defend CHFA’s budget during legislative sessions.

Step-by-Step Guide to Securing CHFA FirstStep

1. Verify Eligibility: Check county income limits and confirm first-time status.
2. Choose a Participating Lender: CHFA’s website lists banks, credit unions, and mortgage brokers.
3. Take the Homebuyer Class: Free, 4–6 hours; weekends available.
4. Submit Full Application: Pay stubs, W-2s, bank statements, and photo ID.
5. Lock Your Rate & Assistance: Lender submits to CHFA for reservation number.
6. Appraisal & Underwriting: Typically 10–14 days; CHFA issues Final Commitment.
7. Close & Celebrate: Sign two notes: one for the first mortgage, one for the zero-interest second.

Frequently Asked Questions

Ready to Take Your First Step?

You don’t have to navigate Colorado’s housing peaks alone. Our brokerage partners with certified CHFA FirstStep lenders statewide. We’ll match you with a local expert, schedule your free class, and prepare a purchase roadmap tailored to your budget. Reach out today, and by the time the aspens turn gold, you could be sipping coffee in your own living room.