Buying your first home in Colorado is more achievable than it may seem. From affordable loans to state-backed assistance, here’s what’s available.
At Foyer, we simplify the path to homeownership for first-time buyers. With personalized guidance and a roadmap tailored to your financial goals, you're never alone in this journey.
Colorado offers a mix of federal loan options, statewide housing programs, and direct financial assistance. Together, these benefits can lower your upfront costs and make qualifying for a mortgage easier.
Most new buyers in Colorado start with one of four main mortgage types. Each offers different advantages depending on your credit, income, and where you plan to buy.
The Colorado Housing and Finance Authority (CHFA) is the state’s central hub for affordable housing support. Through approved lenders, CHFA provides first-time buyers with fixed-rate mortgages, financial assistance, and education resources.
Saving for a down payment is one of the biggest hurdles in Colorado, where home prices can be steep. CHFA helps bridge the gap with flexible down payment support.
Colorado is one of the few states with both down payment support and a First-Time Homebuyer Savings Account (FHSA). By layering CHFA programs with an FHSA, many buyers can buy sooner with less money out-of-pocket.
Yes, Colorado is one of the few states that offers a First-Time Homebuyer Savings Account (FHSA) program. This state-backed incentive allows you to save money specifically for a first home while getting valuable state income tax benefits.
An FHSA is a special savings account you designate for your home purchase. Colorado law allows individuals or couples to deduct qualified contributions and interest earned from their state taxable income. The money must be used toward the purchase of a first home in Colorado.
Setting up an FHSA in Colorado is simple: you can use a savings account, CD, or similar account at any financial institution and designate it as an FHSA when you file your taxes.
The Colorado Housing and Finance Authority (CHFA) is the state’s central provider of homebuyer support. Through CHFA, first-time buyers can access affordable mortgages, down payment assistance, and federal tax benefits — all delivered through a network of approved lenders.
CHFA doesn’t lend directly, but it partners with lenders across the state to offer 30-year fixed-rate mortgages. These mortgages can be paired with FHA, VA, USDA, or conventional loans — giving buyers flexibility based on their financial profile.
CHFA offers two main types of down payment help, both designed to reduce the upfront cash needed at closing.
Colorado also offers targeted benefits through CHFA:
CHFA administers Colorado’s Mortgage Credit Certificate (MCC) Program. An MCC lets first-time buyers claim up to 20% of their annual mortgage interest (capped at $2,000 per year) as a direct federal tax credit. This is in addition to the federal mortgage interest deduction.
All CHFA programs require completion of a homebuyer education course. This can be taken online or in person through CHFA’s approved providers. The course covers budgeting, loan types, and the responsibilities of homeownership. A certificate of completion is required before closing.
Colorado buyers benefit from the absence of some common real estate taxes, plus a range of property tax exemptions that can reduce long-term housing costs. Understanding these can help you budget more accurately for both closing and homeownership.
Colorado does not charge a state transfer tax on home purchases. This means buyers avoid the 0.25–1% fee seen in many other states, saving thousands of dollars at closing.
While there’s no statewide transfer tax, counties and cities may assess documentary or recording fees when a property changes hands. These vary by location and are usually modest compared to a transfer tax. Always confirm expected fees with your title company or lender.
Colorado homeowners may qualify for property tax relief through exemptions:
Closing costs in Colorado typically range from 2% to 5% of the home’s purchase price. On a $400,000 home, this equals $8,000–$20,000. With no transfer tax, buyers save compared to many other states, but should still plan for:
Beyond CHFA’s statewide programs, some Colorado cities and counties provide their own down payment and closing cost assistance. Employers may also offer housing benefits that can be layered with state programs.
Several major cities in Colorado run homebuyer assistance initiatives:
Each program has its own eligibility rules — typically income limits, purchase price caps, and homebuyer education requirements.
Some Colorado employers, especially hospitals, universities, and city governments, offer Employer-Assisted Housing (EAH) programs. These benefits may include forgivable loans, grants, or matched savings for employees buying homes near their workplace.
Local programs often allow stacking with CHFA benefits. For example, a Denver buyer might use CHFA’s first mortgage and down payment assistance while also applying Denver’s 4% grant. By combining programs, buyers can dramatically reduce upfront costs.
Eligibility matters, because most CHFA programs and federal loan options are designed specifically for first-time buyers. Colorado follows the federal definition but also provides some exceptions.
A first-time buyer in Colorado is defined as someone who hasn’t owned a home in the past three years. Exceptions include:
CHFA sets income and purchase price limits that vary by county, household size, and loan type. Limits are typically higher in metro areas like Denver or Boulder compared to smaller counties. Updated charts are published annually on the CHFA site, and lenders can confirm the limits that apply to your situation.
Homes purchased with CHFA assistance must be your primary residence. Buyers usually must move in within 60 days of closing, and if you receive forgivable assistance, you may be required to live in the home for a set number of years.
Most buyers applying for Colorado first-time programs will need:
The fastest way to confirm eligibility is through a CHFA-approved lender. They can quickly determine whether you meet the three-year test, income and purchase price limits, and help you choose the right assistance package.
Every buyer’s timeline looks a little different. Some need more time to save, while others are nearly ready to make an offer. Here’s a plan for both paths.
Colorado is one of the few states with a First-Time Homebuyer Savings Account (FHSA). Open an account, set a goal, and contribute regularly. You’ll save for your down payment while also getting a state income tax deduction on contributions and earnings.
Enroll in a CHFA-approved homebuyer education course. It’s required for CHFA programs and gives you a clear understanding of budgeting, loan types, and closing costs.
Look at options from CHFA, plus local programs in Denver, Boulder, and Colorado Springs. Check with your employer, too — some Colorado workplaces offer matched savings or forgivable housing benefits.
Meet with a lender who works with CHFA programs. They’ll confirm how much home you can afford, walk you through mortgage options, and help you layer in assistance programs.
Apply early for CHFA’s down payment assistance or Mortgage Credit Certificates (MCCs), since some programs have limited funding or deadlines.
When you’re ready to make an offer, ensure your purchase contract reflects any assistance you’re using. Work with your lender and title company to confirm your estimated closing costs.
In Colorado, a first-time buyer is generally defined as someone who has not owned a home in the past three years. To qualify for CHFA programs, you’ll also need to meet income and purchase price limits, complete homebuyer education, and plan to occupy the property as your primary residence. Veterans and buyers in federally designated Targeted Areas may qualify even if they’ve owned a home more recently.
You may not qualify if you’ve owned a home within the last three years, unless you fall under a specific exception. Exceeding the income or purchase price limits can also disqualify you, as can purchasing a home you don’t intend to live in as your primary residence. Investment or vacation properties aren’t eligible for CHFA assistance.
The required down payment depends on your loan type. FHA loans require as little as 3.5% down, while conventional loans may allow first-time buyers to put down just 3%. VA and USDA loans go further, offering 0% down if you qualify. Many buyers combine these loan types with CHFA’s down payment assistance, which can cover part, or sometimes all, of the upfront cost.
Yes. CHFA offers a Down Payment Assistance Grant worth up to 3–4% of your mortgage amount, which never has to be repaid. Local programs in cities like Denver, Boulder, and Colorado Springs also provide forgivable loans or grants that can be layered with CHFA assistance.
Income limits vary by county, household size, and program type. Limits in metro areas like Denver are higher than in smaller rural counties. CHFA publishes updated income and purchase price limits each year, and your lender can confirm which ones apply to you.
Yes. While Colorado doesn’t offer a first-time buyer–specific property tax break, homeowners can apply for the state’s Homestead Exemption for Seniors and Disabled Veterans, which reduces the taxable value of a home. Some municipalities also offer targeted credits for low-income or first-time homeowners.
Foyer gives you a dedicated place to save for your first home in Colorado. You can set clear milestones, automate contributions, and track your progress whether you’re building slowly with an FHSA or sprinting toward closing.
We break down CHFA programs, FHSA rules, and local assistance options in plain language, so you know exactly what’s available to you. When you’re ready, Foyer connects you with trusted Colorado lenders and agents who understand how to stack statewide and local programs for maximum benefit.
Foyer is here to help you plan and save, but we don’t provide tax, legal, or lending advice. Banking services are offered through our FDIC-insured partner. For FHSA designations, CHFA programs, or tax credits like MCCs, we recommend working with your lender and tax professional.
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Foyer is a fintech company, not an FDIC-insured bank. Banking services provided by Pacific West Bank, Member FDIC. Deposit insurance covers the failure of an insured bank.
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