FirstDown First-Time Homebuyer Assistance Programs

FirstDown New Mexico: Unlock Your First Home with Down Payment Assistance

Ready to swap rent payments for equity? FirstDown, the statewide down-payment assistance program, makes that leap less daunting by pairing a 30-year mortgage with a zero-interest second loan. Within the first hundred words of this guide, you’ll learn how FirstDown New Mexico can shave thousands off your upfront costs and speed up your move-in day.

Why Down-Payment Help Matters in the Land of Enchantment

New Mexico’s median existing-home price crossed $315,000 in 2023, according to a regional REALTORS® report. For many renters, saving even 3% of that price—roughly $9,450—feels like scaling the Sandias barefoot. Down-payment assistance eases the climb, keeps emergency funds intact, and opens the door to generational wealth. FirstDown is the only statewide option that stacks seamlessly with FHA, VA, USDA, and conventional loans, amplifying your purchasing power without charging a premium interest rate.

How Does FirstDown Work?

At its core, FirstDown is a two-loan package designed by the New Mexico Mortgage Finance Authority (MFA). Think of it as a main course with a side dish—satisfying on its own, unbeatable together.

A Quick Walk-Through of the Two-Loan Structure

• Primary MFA 30-Year Mortgage
  • Competitive fixed rate—often 0.125% to 0.250% below market quotes.
  • Minimum 620–660 FICO, depending on loan type.
• Second “Soft-Second” Loan
  • 0% interest, no monthly payments.
  • Covers up to 8% of the home’s purchase price, capped at $50,000.
  • Repayment triggered only when you sell, refinance, or stop occupying the home.

Because the assistance is structured as a lien, borrowers maintain skin in the game without the pressure of an added bill every month—an elegant balance between empowerment and fiscal responsibility.

Who Is Eligible for FirstDown in New Mexico?

Eligibility boils down to three buckets: buyer profile, property profile, and financial profile. Let’s unpack each one.

1. Buyer Profile

• You must be a first-time buyer—defined as no ownership interest in a primary residence during the past three years. Military veterans are exempt from this rule.
• Legal residency in the U.S. and proof of New Mexico residency or intention to establish it.
• Completion of a HUD-approved homebuyer education course.

2. Property Profile

• Single-family, condo, or manufactured home on a permanent foundation.
• Located within New Mexico and meeting purchase-price caps (2024 example: $381,308 in non-targeted counties; $466,551 in targeted zones).
• Must be your primary residence within 60 days of closing.

3. Financial Profile

• Household income limits vary by county and family size, ranging from about $83,680 in rural Catron County to $122,720 in Bernalillo County.
• Debt-to-Income ratio generally maxes out at 50% back-end, though most lenders target 45% for smoother approval.

These thresholds adjust annually, so cross-check the latest MFA FirstDown chart before you apply.

How Much Assistance Can I Receive Through FirstDown?

The headline number—up to 8%—translates differently based on purchase price. Here’s a quick cheat sheet:

Notice how the assistance can more than cover the down payment and closing costs combined, depending on loan type. In many cases, buyers walk out of escrow with a refund of their earnest money deposit—money that can furnish the new home or pad an emergency fund.

Step-by-Step Guide to Applying for FirstDown

1. Self-Assess
   Pull a free credit report, tally your debts, and confirm you meet income limits.
2. Complete Homebuyer Education
   Online or in-person courses cost $25–$75 and typically last six hours.
3. Choose an MFA-Approved Lender
   Over 80 institutions statewide participate—community banks to national lenders.
4. Get Pre-Qualified
   Submit pay stubs, W-2s, and bank statements. The lender will layer FirstDown on top of your first mortgage.
5. Find Your Home
   Work with a REALTOR® who knows MFA nuances and target areas.
6. Underwriting & Approval
   Expect 30–40 days from signed contract to closing. MFA’s turnaround is often 48–72 hours once a complete file is submitted.
7. Close & Move In
   Sign two sets of loan docs, collect your keys, celebrate!

A Borrower’s Micro-Story: Maria & Joshua in Las Cruces

Maria, a public-school librarian, and Joshua, a solar technician, spent two years saving 5% for a starter home. Rising rents kept moving the goalpost. Their lender introduced the FirstDown down-payment assistance option. By leveraging a $24,100 soft-second, the couple closed on a $301,000 three-bedroom without draining their emergency stash. “We used the cash we didn’t spend on a water-softener and native landscaping,” Joshua notes—proof that homeownership and sustainability can coexist on a modest budget.

Pros and Cons of Using FirstDown

Tips to Strengthen Your Application

• Pay down revolving debt to boost your credit score and lower your DTI.
• Gather two months of bank statements free of large cash deposits—it prevents underwriting hiccups.
• Request seller credits for repairs; FirstDown New Mexico assistance can then be directed fully to down payment.
• Lock your rate early when the bond market dips—MFA’s rates update daily at 10 a.m.

Frequently Asked Questions About FirstDown

Can I combine FirstDown with a VA loan?

Yes. MFA allows VA financing, and the soft-second simply fills the gap between loan amount and total cost.

Do I have to be a New Mexico resident now?

No, but you must occupy the property within 60 days, effectively establishing residency then.

Is there a pre-payment penalty on the second loan?

None. You may repay the soft-second at any time without extra fees.

What if I refinance to drop PMI?

The assistance balance becomes due when you refinance; many homeowners roll it into the new loan.

Does FirstDown fund new construction?

Yes, as long as the builder issues a Certificate of Occupancy before closing and price limits are met.