How Virginia DHCD Assistance works
This is a deferred loan, not a grant, with no payments or interest. It is forgiven after 5 years for $1,000–$14,999 or 10 years for $15,000–$40,000; if sold earlier, it is repaid from net proceeds. The home must be your primary residence.
Assistance is up to 10% of price, or 15% in DHCD-approved areas, plus up to $2,500 closing costs. The maximum is $40,000 and minimum is $1,000. Regional providers administer it; coverage varies by locality and funding is first-come, first-served.
First-time means no ownership in 3 years; income is at or below 80% AMI. HUD counseling and homebuyer education are required. Median FICO must be at least 620. The buyer pays 1% or $500 by income. Cash assets of 10% or more of the price disqualify; home value must be at or below 95% of area median price; 90-day work history is required. DTI rules differ across DHCD documents; confirm with the program.
The first mortgage must be fixed-rate Conventional, VA, FHA, USDA or Habitat from a direct VA-licensed lender. Brokers, adjustable-rate, interest-only, balloon and FHA rehab (203 k) loans are not allowed.
Key benefits
Forgivable deferred loan
No payments or interest; forgiven after 5 years for $1,000–$14,999 or 10 years for $15,000–$40,000.
Down payment and closing costs
Up to 10% of price, or 15% in approved areas, plus up to $2,500 closing costs, capped at $40,000.
Several first-mortgage types
Fixed-rate Conventional, VA, FHA, USDA or Habitat from a direct VA-licensed lender.
The steps
Find your regional provider
Coverage varies by locality; funding is first-come, first-served.
Complete counseling and education
HUD counseling and homebuyer education are required.
Check income, assets and credit
Income at or below 80% AMI, median FICO at least 620; cash assets of 10% or more of price disqualify.
Choose a direct lender
Use a fixed-rate eligible first mortgage from a direct VA-licensed lender, not a broker.
Watch out for
Selling before forgiveness
The deferred loan is repaid from net proceeds if the home is sold early.
Assuming statewide availability
Regional provider coverage varies by locality and funding is first-come, first-served.
Assuming one DTI rule
DHCD documents differ on DTI rules; confirm with the program.
Frequently asked questions
Is DHCD assistance a grant?
No. It is a deferred loan with no payments or interest, forgiven after 5 or 10 years by loan amount; if sold earlier, it is repaid from net proceeds.
How much assistance is available?
Up to 10% of price, or 15% in approved areas, plus up to $2,500 in closing costs, with a $40,000 maximum and $1,000 minimum.
Can I use a mortgage broker?
No. The first mortgage must come from a direct VA-licensed lender and be an eligible fixed-rate Conventional, VA, FHA, USDA or Habitat loan.
Is the program available everywhere in Virginia?
Regional providers administer the program and coverage varies by locality. Ask a provider about availability and confirm DTI rules with the program.
See which programs may fit
Check your options and confirm local provider coverage and current terms.
Check If You May Qualify
Find Programs I May Qualify ForProgram details change frequently — verify current guidelines with a licensed lender; this is not a commitment to lend or a guarantee of eligibility.
Last updated: October 2026. Licensed in VA, MD and DC. Not affiliated with Virginia Housing, the Virginia Department of Housing and Community Development, or any county or city housing office.
Related programs
Source: Virginia Department of Housing and Community Development (dhcd.virginia.gov). Checked 2026-10-02.