First-time home buyer programs in New York

When it comes to first-time home buyer programs, New York has a lot to offer. That is welcome news for first-time home buyers as housing prices continue to stretch affordability in the state. Follow along to learn more about the loans, down payment assistance, and other programs for first-time buyers in New York that can help you achieve your dream of home ownership.

Dig deeper: Everything to know as a first-time home buyer

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The State of New York Mortgage Agency (SONYMA) is a state-sponsored mortgage agency that provides home- buying assistance programs directly to low-income and first-time home buyers. While they don’t provide the home loans themselves, they partner with approved lenders to provide low-interest first mortgage loans, as well as loans for assistance with down payments, closing costs, or home repairs.

New York City and other municipalities also offer first-time home buyer programs, but we will focus on SONYMA’s statewide programs below. Check out the U.S. Department of Housing and Urban Development’s website for more information on local home-buying programs in New York.

SONYMA offers two unique first mortgage programs as well as conventional and FHA mortgage programs. If you qualify for one of these programs, you can also access an array of assistance to cover the down payment, closing costs, and other expenses that may arise when buying a home.

Dig deeper: What’s the latest on first-time home buyer tax credit?

The Achieving the Dream program provides the lowest interest rates that SONYMA has to offer. This 30-year fixed-rate mortgage loan is exclusive to first-time home buyers and offers low interest rates set by SONYMA to guarantee maximum savings. Once you receive your interest rate, you can lock it in for 120 days for an existing home and 240 days for properties under construction, a much longer lock-in time than the typical 30 to 60 days.

Achieving the Dream requires a 3% down payment, but first-time home buyers also have access to down payment assistance programs that they can use in conjunction with the program. However, no matter the assistance program, the first-time home buyer must provide at least a 1% cash contribution (3% for co-ops) for the loan.

The Low Interest Rate program has many of the same features as the Achieving the Dream loan but comes with higher interest rates (despite its name) and higher income limits. The home sales price limits are pretty much the same for the two programs.

For example, as of Jan. 3, 2025, Achieving the Dream loans could receive a 6% interest rate (if you don’t use down payment assistance), while a Low Interest Rate loan could receive a 6.625% interest rate. These rates are subject to change at any time, so it is essential to check SONYMA’s current interest rates before you apply.

The Conventional Plus loan program combines a 30-year fixed-rate loan with additional down payment assistance. It is available to both first-time and repeat home buyers but must be used to purchase your primary residence. The conventional mortgage loan follows guidelines set by Fannie Mae’s HomeReady Mortgage program to offer flexible credit and eligibility requirements. The down payment assistance is provided by SONYMA’s Down Payment Assistance Loan (DPAL) program, which we cover more below.

Learn more: How a conventional loan works

The FHA Plus program combines a 30-year fixed-rate FHA loan with additional down payment assistance. The first mortgage loan is based on HUD’s underwriting and eligibility standards, while the down payment assistance is based on SONYMA’s DPAL program.

Dig deeper: FHA loans — 2025 requirements, limits, and loan types

SONYMA has several additional programs to help you fund your down payment, closing costs, renovation expenses, and more.

The Down Payment Assistance Loan program provides a 0% interest loan worth up to $15,000 that you can use for the down payment or closing costs. The loan is 100% forgiven once you live in the house for 10 years — but that doesn’t mean you have to pay the entire loan back if you move before then. The repayment amount decreases by 1/120 per month, so your liability decreases consistently throughout your time in the home.

When you use DPAL with most SONYMA loan programs, the interest rate on your first mortgage will increase by 0.375%. However, there are some programs below that are excluded from this hike.

Learn more: How down payment assistance works and how to qualify

The DPAL PLUS ATD program is an enhanced assistance program reserved for first-time buyers who earn less than 60% of the area median income (AMI). This beefed-up program also issues 0% interest loans that are forgivable after 10 years, and the loan amount limit is increased to $30,000.

The program is designed to help low-income borrowers get enough funds to put down a full 20% down payment so they can avoid private mortgage insurance (PMI). If $30,000 is not enough to get you to 20% down, you can also use the funds to pay for single premium mortgage insurance so you don’t have to make monthly mortgage insurance payments. The funds can also be used to pay closing costs.

Dig deeper: What is private mortgage insurance, and how much does it cost?

SONYMA’s programs not only help you purchase a home, but they can also help you fix one. The RemodelNY program offers a 30-year loan with the same interest rates as the Achieving the Dream or Low Interest Rate programs.

The loan amount is based on either the “after-improved” appraised value of the home or the purchase price of the home, plus the repairs and certain allowable fees, whichever option is lower.

The Homes for Veterans program offers low-interest loans to U.S. military veterans, active duty service members, their spouses or co-borrowers, National Guardsmen, and reservists. Veterans don’t even have to be first-time home buyers to access this program.

The program is one of the few offered by SONYMA that does not require increased mortgage rates for using down payment assistance. Veterans only have to put 1% of their own money down and can fund the remaining 2% from down payment assistance programs for a total 3% down payment.

Instead of moving back in with your parents, how about moving into your own home after graduating college? The Graduate to Homeownership program can help you achieve this goal by providing a competitive 30-year fixed-rate mortgage loan if you have graduated from an associate’s, bachelor’s, master’s, or doctoral program within the past 48 months. A key consideration is that this program is only available in “certain upstate New York communities,” according to SONYMA’s website.

The Neighborhood Revitalization program offers a 30-year fixed-rate loan worth up to $20,000 to spend on eligible improvements to your new home. The key to this program is that the improvements must be deemed “necessary” by SONYMA. Renovations to improve the structure, safety, or accessibility of the home are generally deemed necessary, but SONYMA reserves the right to determine what renovations are approved.

The Credit is Due program is designed to address the racial gap in housing by providing competitive 30-year fixed-rate loans with broad eligibility standards, including flexibility for credit and non-traditional income sources, more flexible responses to late programs than many programs, and shorter wait times to buy a home after filing for bankruptcy.

The program also comes with exclusive loan enhancements like the Enhanced Down Payment Assistance Loan and up to a 2% interest rate reduction.

Learn more: How bankruptcy affects keeping or buying a home

The Energy Star® Labeled Homes program allows first-time home buyers using the Achieving the Dream or Low Interest Rate first mortgage programs to receive additional down payment assistance on energy-efficient homes. The program is reserved for new construction homes that meet New York Energy Star® efficiency standards, which typically make homes 20% to 30% more efficient.

With this program, you can receive up to $15,000 in down payment assistance without the 0.375% increase in your first mortgage interest rate.

Dig deeper: How does an energy-efficient mortgage work?

This program allows first-time home buyers using the Achieving the Dream or Low Interest Rate first mortgage programs to purchase manufactured homes affixed to a foundation.

Specific eligibility requirements will depend on the program and the mortgage lender providing the loan. However, SONYMA does have some general eligibility guidelines:

First-time home buyer definition: A “first-time home buyer” typically refers to someone who has not owned a principal residence in three or more years.
Occupancy: All four SONYMA first mortgage programs are reserved for home buyers who will use the home as their primary residence.
Income: All SONYMA loan programs, except the FHA Plus program, have income limits based on the program, the type of home you’re buying, and the property’s location.
Sales price: All SONYMA first mortgage programs have varying sales price limits depending on the program and location of the property.
Educational courses: Depending on the type of program you apply for, you may be required to take a homeownership education course.
Credit score: SONYMA generally requires “good credit” to qualify for their loan programs, but the specific score required can differ depending on the loan program.

Learn more: The credit score needed to buy a house

SONYMA has a four-step process to apply for their first-time home buyer programs:

Get prequalified: Getting prequalified for a loan from one of SONYMA’s approved mortgage lenders can show sellers that you’re a serious buyer and give you a good idea of the homes you can afford. You’ll need to provide the necessary financial information that the lenders require. More information can be found on SONYMA’s website, but the exact requirements will depend on the lender.
Find a home and sign a contract: When you’ve found the home you’d like to buy, sign the contract and provide SONYMA with the official offer letter.
Update your application and lock in your rates: You must update your application with property information such as the address, sales price, and total loan amount. Once this information is finalized, SONYMA can lock in your interest rate and review the final loan package.
Stay in touch with your lender: It is essential to stay in touch with your mortgage lender until the entire loan process is complete, you’ve signed the closing documents, and you have the keys to your new home.

Yes, the state of New York offers first-time home buyer programs through the State of New York Mortgage Agency (SONYMA). Two of the most popular, the Achieving the Dream and Low Interest Rate programs, are available to lower-income buyers across the state. But SONYMA also offers region-specific options in areas like New York City and Buffalo.

If you’re a first-time home buyer in New York getting a standard mortgage, your minimum down payment will depend on which type of mortgage you choose. For example, you’ll need 3.5% down for an FHA loan. However, your requirements will vary if you apply for a state-sponsored program through SONYMA. You may be eligible to put just 1% down or qualify for considerable down payment assistance.

It depends on what type of mortgage loan you get. If you’re getting a standard conventional loan, you’ll usually need a 620 credit score. FHA loans typically require scores of 580 or higher. But if you’re going through New York’s state-sponsored agency, SONYMA, the minimum will depend on which SONYMA program and partner mortgage lender you select.

This article was edited by Laura Grace Tarpley.

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