Rates Are Still Near 6.76%. Colorado’s CHFA Program Can Hand You Up to $25,000 to Close Anyway.

By Prerna Kapoor, CLHMS | REAL Brokerage | September 11, 2026

Freddie Mac’s weekly survey put the 30-year fixed rate at 6.76% this week, up from 6.71% the week before. Rates have not meaningfully budged in months. If you’ve been holding off on buying because you assumed you needed a large cash cushion at closing, there’s a program a lot of Colorado buyers still don’t know enough about: CHFA down payment assistance.

What CHFA Actually Is

CHFA, the Colorado Housing and Finance Authority, is a state agency that pairs a 30-year fixed-rate first mortgage with down payment help. You don’t apply to CHFA directly. You work with a CHFA-approved participating lender, the same way you’d shop any other mortgage, and the lender originates both the first mortgage and the assistance together.

There are two families of CHFA first mortgage: FirstStep and FirstStep Plus, which use FHA, VA, or USDA-RD financing and are reserved for first-time buyers, defined as not having owned a home in the past three years. SmartStep and SmartStep Plus are open to first-time and repeat buyers alike, and can be paired with FHA, VA, USDA-RD, or conventional financing.

The Down Payment Help Itself: Grant or Second Mortgage

This is the part worth slowing down on, because the two options behave very differently. CHFA’s Down Payment Assistance Grant gives you up to the lesser of $25,000 or 3% of your first mortgage amount, and you never pay it back. CHFA’s Down Payment Assistance Second Mortgage Loan gives you up to the lesser of $25,000 or 4%, but it’s a real loan, repaid when you sell the home, refinance, or pay off the first mortgage.

You can use one or the other, not both, alongside a CHFA first mortgage. The grant sounds like the obvious choice since nothing is owed back, and for a lot of buyers it is. But the second mortgage gets you more dollars up front, which can matter if you’re right at the edge of qualifying, and some buyers use it deliberately because they plan to sell or refinance within a few years anyway. There isn’t a universally correct answer here. It depends on how long you plan to stay, how much cash you actually have, and what your lender’s side-by-side numbers show.

Who Actually Qualifies

Across CHFA’s programs, you’ll generally need a mid credit score of at least 620, and you’ll need to put at least $1,000 of your own money into the purchase. That last part surprises people. CHFA wants to see you have some skin in the game, even with assistance covering the rest of the down payment.

You’ll also have to complete a CHFA-approved homebuyer education class before closing, which includes a module called Understanding Your Financial Commitment. It’s not a rubber-stamp formality. It walks through what homeownership actually costs beyond the mortgage payment, and I’ve had clients tell me afterward that it changed how they thought about their monthly budget.

Income limits are where FirstStep and SmartStep genuinely diverge. FirstStep and FirstStep Plus use income limits that vary by county, since they’re built around federal FHA, VA, and USDA-RD guidelines. SmartStep and SmartStep Plus use one flat number statewide, currently $174,440, regardless of which county you’re buying in or how many people are in your household. That flat limit is generous enough that a fair number of dual-income households in Douglas and Arapahoe counties, who might assume they make too much for down payment assistance, are still under it.

What This Looks Like in Parker and the South Denver Suburbs Right Now

I’ve had more of these conversations this year than in the two before it combined, and the pattern is consistent. It’s usually a buyer with solid income and good credit who simply hasn’t had years to save a traditional down payment, especially anyone who moved to Colorado in the last few years and is still catching up to local price levels. CHFA doesn’t change what a home in Parker or Highlands Ranch costs. It changes how much of your own cash you need sitting in the bank the day you close, and at a rate near 6.76%, that gap is what’s keeping some otherwise-qualified buyers on the sidelines longer than they need to be.

One honest caveat: a CHFA first mortgage is not always priced identically to a plain conventional loan, since the funding structure that makes the assistance possible is different. Ask your lender to run your numbers both ways, with and without CHFA, before you decide. Sometimes CHFA is clearly the better path. Sometimes a slightly larger loan at a marginally different rate nets out about the same. You want to see the real comparison, not just the label.

Quick answers

Do I have to be a first-time buyer to use CHFA?
Only for FirstStep and FirstStep Plus. SmartStep and SmartStep Plus are open to repeat buyers too, as long as you meet the credit, income, and contribution requirements.

Can I combine the grant and the second mortgage for more money?
No. CHFA lets you use one or the other alongside a CHFA first mortgage, not both together.

Where do I actually apply?
Through a CHFA-approved participating lender, not through CHFA directly. Ask any Colorado lender you’re already talking to whether they’re CHFA-approved, or I’m happy to point you toward a few I’ve worked with.

Prerna Kapoor | REALTOR® | Luxury Home Specialist
REAL Brokerage | 720-949-5450 | info@prernakapoor.com
CLHMS • RENE • PSA • ABR | International Sterling Society Award Winner

Prerna specializes in residential real estate across Parker, Aurora, Lone Tree, Castle Pines, Highlands Ranch, Cherry Creek, Greenwood Village, and Centennial. She speaks English, Japanese, and Hindi. For the affordability math behind a decision like this, see how much house you can actually afford in Colorado, and for the credit-score side of qualifying, see how your credit score affects home buying here. CHFA is most often paired with an FHA loan, and for a broader look at how Colorado buyers finance a purchase, see the Colorado Buyer Financing Playbook.