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NY First Time Homebuyer Programs & Grants

The state of New York is ready and willing to help first-time homebuyers who want to fulfill that part of the America dream.

If home ownership seems out of reach, despair not. The State of New York Mortgage Agency (SONYMA) offers several programs for first-time buyers. The agency works with lenders throughout the state to find lower-interest mortgages for New York residents at low-to-moderate income levels.

SONYMA also helps with down payments, and all programs can be combined with other grants and subsidies. The various programs allow flexibility to buy homes, condominiums or co-ops.

Each program has specific requirements and qualifications such as limits on incomes and credit scores. If you are a first-time homebuyer, most programs also require the completion of a homebuyer education course from a nonprofit, HUD-approved agency.

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The first-time buyer requirements are waived for U.S. military veterans applying to buy a home, or those buying in a federally designated “target area” where home ownership may provide a boost to a disadvantaged area.

The other good news: SONYMA considers any resident who has not bought a home in the past three years and who does not own a second home a first-time buyer.

These programs are the reason many in-state New Yorkers totally understand the old slogan: “I ❤️ New York.”

NY First Time Homebuyer Qualifications

Obviously, buying a home isn’t like buying a loaf of bread. There are applications and credit checks and financial decisions based on budget. Though SONYMA requirements can be specific to each program, applicants generally have to take a course designed to help first-time buyers.

The state of New York specifies:
  • A two-year history of verifiable income and employment
  • A credit history that shows a record of timely payments
  • Sufficient income to cover the costs of homeownership while still meeting other debts; typically this means an overall debt-to-income ratio of 45% or less
  • Possession of funds to pay the down payment and closing costs
  • Private Mortgage Insurance (PMI) if the down payment is less than 20%
  • The completion of a homebuyer education course

Achieving the Dream Program

Achieving the Dream is one of the main programs offered to lower-income, first-time buyers. Borrowers will receive reduced interest rates and a lower down payment requirement on a 30-year loan.

Benefits of the Achieving the Dream Program include:
  • A lowered interest rate that in September of 2020 was 2.875%
  • A lower down payment on a 30-year loan, as low 3% of the purchase price
  • No points on the loan
  • Incentives for those who buy energy-efficient, new homes
  • Can be combined with other SONYMA programs
Some of the requirements for the Achieving the Dream Program include:
  • Prove steady employment and an adequate credit history
  • Meet income requirements based on location
  • Consider a home referred by SONYMA that meets price limits based on location
  • Make the home primary residence
  • A cash contribution worth at least 1% of the property value is required on the down payment
  • If the down payment is lower than 20%, PMI is required
  • Complete a homebuyer education course

SONYMA allows buyers to use its Down Payment Assistance Loan (DPAL) together with Achieving the Dream to help with the purchase. The agency limits DPAL loans to $3,000 or 3% of the home purchase price, up to $15,000, whichever is greater. The DPAL can be used for down payment, closing costs and PMI, but cannot be more than the full down payment and closing costs.

A DPAL will increase the mortgage interest rate slightly — in September of 2020 the increase was .375% — but that is offset by the best part of DPAL: These loans have no interest and require no monthly payments. They also are forgiven after 10 years if the buyer keeps the mortgage payments up to date.

Low Interest Rate Program

This program helps buyers obtain a lower interest rate on his or her loan. However, it’s wisest to also check the rates on the Achieving the Dream program, which can be even lower. The SONYMA web page has a link for both programs that leads to available rates.

Benefits of the Low Interest Rate Program include:
  • A 30-year fixed rate mortgage with no points
  • Down payment as low as 3%, with SONYMA assistance available
  • The ability to combine this program with other grants and subsidies through SONYMA
Eligibility criteria for the Low Interest Program include:
  • Good credit, a proven record of employment and the ability to meet all debts
  • The property must be occupied as your primary residence
  • A minimum cash down-payment of 1% of the loan (3% for co-ops)
  • If the down payment is lower than 20%, PMI is required
  • Varying income limits by county
  • The price cannot exceed SONYMA’s limits specific to the program, determined by county
  • The home cannot be used for agricultural purposes
  • Completion of a homebuyer education course

Conventional Plus Program

The attractive benefit of Conventional Plus is it can be used to refinance an existing mortgage as well as help those buying for the first time. This loan has several attractive features, including a 30-year loan for repurchase or refinance and down payment help.

The benefits of the Conventional Plus Program include:
  • A lower interest rate on a 30-year fixed rate loan, which leads to lower payments than typical mortgages
  • The additional option of using the program to refinance
  • The down payment can be used to pay closing costs

Credit scores must be high; a minimum of 620 is required for a one- or two-unit home; 680 for larger homes. Income must be less than 80% of  the median Income for the area where the buyer lives. The property address must be checked through the FMNA Ready Eligibility Tool to asses the income limit. The SONYMA web site provides a link to the eligibility check. The maximum loan depends on family size.

FHA Plus Program

A program that combines SONYMA down payment assistance with an already-low-down-payment Federal Housing Administration (FHA) backed mortgage. Interest rates vary by loan and home size and may be higher than with other loans. But because the mortgage is FHA-backed, lenders allow more flexibility in requirements. Borrowers also must put down 3.5% .

There is no minimum loan, but the maximum varies per county. The maximum loan for any county with this program is $510,400 for a single-family residence, according to M&T Bank.

At least 1% of the down payment must be in cash, but a DPAL can be used for the remainder.

The loan cannot be used for co-ops

This loan is best for New York residents with moderate income seeking to reduce their down payment.

Homes for Veterans Program

A program exclusively for veterans, active or not. Nonactive veterans do not even need to be a first-time homebuyer, though with a dishonorable discharge are excluded. SONYMA’s help. This also applies to members of the National Guard or Reserve.

Benefits of the Homes for Veterans Program:
  • Interest rates .375% lower than standard SONYMA interest rates for loans with down payment assistance
  • Down Payment Assistance Loans for up to $3,000 or 3% of the purchase price (not to exceed $15,000), whichever is higher
  • Minimum borrower cash contribution is only 1%; the remaining 2% can come from a gift or other acceptable source
  • No points
Requirements for Homes for Veterans Program:
  • You must be either a U.S. military veteran or active duty serviceperson and be able to provide the following documentation with your application:
  • DD214 – Certificate of Release or Discharge from Active Duty or NGB Form 22 – Report of Separation and Record of Service
  • Leave and Earning Statement (required for all active duty U.S. military personnel)
  • Military ID Card (required for all active duty U.S. military personnel)
  • Military Veteran’s Eligibility Affidavit (SONYMA Form 243) is required only if an eligible veteran or their spouse or co-borrower is not a first-time homebuyer

Graduate to Homeownership Program

This program for recent college graduates offers down payment help, favorable interest-rate loans and education on home buying. Homes must be purchased in specific towns in varying areas of the state – for example Albany, Glens Falls or Hudson in the Capital Region;  Middletown or Kingston in the Mid-Hudson area; and Amsterdam, Oneonta or Rome in the Mohawk Valley. A complete list of eligible towns is available on the SONYMA web site.

The program offers competitive 30-year fixed interest rates and may be combined with other SONYMA grants and assistance programs.

Requirements for the Graduate to Homeownershop Program include:
  • Be a graduate with an associate, bachelor’s, master’s, or doctoral degree within the previous 48 months from an academic program recognized by the U.S. Department of Education
  • Have good credit, stable employment, and be able to make monthly mortgage payments
  • Regional income limits apply and vary by county

RemodelNY Program

Looking to upgrade or remodel? SONYMA can help here as well with specific 30-year home-improvement loans that allow homeowners to finance up to 97% of the estimated value of the home after improvements. Put in real terms, if the home is worth $200,000 before and $300,000 after remodeling, the state will help you borrow $97,000 – and use a DPAL to do so.

The benefits of the RemodelNY Program:
  • Low interest rates and down payments; DPAL loans are available
  • Those buying a home and planning to remodel immediately may use an Achieving the Dream mortgage and its benefits along with the remodeling loan
  • A required 10% contingency reserve must be established
  • Draws for renovations are monitored through a SONYMA account
Specific improvements eligible for the RemodelNY loan include:
  • Structural alterations and reconstruction, like finishing a basement, repairing chimneys, and adding garages
  • Remodeling kitchens and bathrooms
  • New free-standing appliances
  • Eliminating health and safety concerns
  • Aesthetic changes, like new siding or paint
  • Plumbing updates
  • Roofing, gutters, and downspouts
  • Flooring
  • Energy conservation updates
  • Major landscaping and site improvements
  • Elevating the home, filling in below grade space or raising mechanicals to lower flood insurance premiums

Energy Star Labeled Homes Program

This program offers special financing to buy new energy efficient homes built to federal and New York state standards. Those features may include high performance windows, insulation, and energy efficient heating and cooling systems and light fixtures. New York ENERGY STAR labeled homes are typically up to 30% more efficient than a standard home. SONYMA also offers mortgages designed to buy new homes built with energy-efficient applications. According to SONYMA, ENERGY STAR labeled homes can save home owners hundreds of dollars a year.

Benefits include an interest rate .375% lower than standard, as well as down payment assistance. Eligible properties have to be newly built one family homes, or newly constructed two-family homes in SONYMA designated target areas.

During the construction phase of your New York ENERGY STAR® Labeled Home, a certified third-party Home Energy Rating System (HERS) rater must perform an inspection of the home to ensure that it is being built to the New York ENERGY STAR® standards. A final home energy rating is performed near completion of the home.

Neighborhood Revitalization Program

In an effort to help areas hit hard by foreclosures, SONYMA provides an inventory of available vacant homes. Qualified buyers receive incentives to buy and restore these vacant properties.

Buyers can receive up to $20,000 on DPAL terms to renovate qualified home, and seek additional improvement money through other lenders. This program can be combined with other SONYMA loans and programs to make an attractive option more attractive.

The property must be located in one of the designated communities, and the buyer must have good credit, regular employment and have the ability to make the monthly mortgage payments. Regional income limtis apply for qualification, and vary by county.

NY Down Payment Assistance Loans

Finding the down payment can be difficult for first-time buyers, especially at the income levels SONYMA helps. So the agency offers this important and almost unbelievable program – no interest rate, no monthly payments — to help. These loans could be as much as $15,000, and are available to all buyers using a SONYMA mortgage program and can be combined with those programs. Perhaps the best facet of this program: If buyers keep mortgage payments current, the loan is forgiven after 10 years. Essentially it is free money to those who simply pay their mortgage on time.

Benefits of NY Down Payment Assistance include:
  • A 0% interest rate with no monthly payments
  • The loan is forgiven after 10 years
  • The maximum loan is 3% of the purchase price up to $15,000, or $3,000, whichever is greater.
  • This loan may slightly increase the interest rate

How to Apply for NY First Time Homebuyer Programs

SONYMA can and will help at every step of the home purchase, though the buyer should have his or her own attorney and real estate agent. Mortgages are available through a network of lenders across the state, and the lenders are familiar with SONYMA programs.

The SONYMA lender will help and guide the buyer at every step, which in order are:
  • Get pre-qualified with a SONYMA lender. A pre-qualification letter tells sellers you are prepared to buy, and provides a price range of affordable mortgages. A list of SONYMA lenders broken down by region is available on the SONYMA web site.
  • Find a home and sign a contract on the agreed-on price. This will require a good-faith deposit, usually about $1,000, which tells the seller you are serious.
  • If the contract requires a higher down payment than you can afford, SONYMA has programs that allow borrowing up to 97% of the purchase price.
  • Update your application and lock in the interest rates. The updated application will include the property address, final sales price and total loan as well as the final interest rate.
  • Find a lender through SONYMA’s list of lenders, also broken down by region. SONYMA also provides a list of what it calls Hall of Fame Loan Officers.

NY First Time Home Buyer Grants

The state of New York has 17 programs to help with grants, which do not need to be paid back (thus the term, grants). Entities that provide them include local government, community development groups and nonprofits.

While eligibility requirements are specific to the grants, general requirements include:
  • Be a first-time home buyer.
  • Take a home buyer education course.
  • Satisfy income requirements.
  • Satisfy purchase price requirements.
  • Occupy the house as your primary residence.
  • Purchase in an approved location.

There are 17 state grant programs for first-time buyers. The Housing Opportunities Foundation grant is a statewide program that provides $2,000 awarded from a lottery of applicants. Many more grants are awarded in specific areas of the state. The first step is to see what’s available where you want to buy, then contact the organization offering the grants.

National First Time Homebuyer Programs

The U.S. government also offers first-time home buyer programs. The Good Neighbor Next Door is geared to helping teachers. The HomePath Ready Buyer program offers help with foreclosures. There are also programs through the FHA and for energy-efficient homes, among others.

Find a Homebuyer Education & Pre-Purchase Counseling Course

The process of buying a home can be complicated and intimidating. It’s for that reason a lot of lenders list homebuyer education as a requirement. The goal is to gain knowledge about what’s ahead, because knowledge is power. Several courses are available for online homebuyer education. Also available are several options to find homebuyer credit counseling, which can ease the nerves about applying and qualifying for a mortgage.

About The Author

Bill Fay

Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it in 2012, helping birth into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering the high finance world of college and professional sports for major publications, including the Associated Press, New York Times and Sports Illustrated. His interest in sports has waned some, but he is as passionate as ever about not reaching for his wallet. Bill can be reached at [email protected].


  1. N.A. (ND) Preparation and Eligibility. Retrieved from
  2. N.A. (ND) SONYMA Programs. Retrieved from
  3. N,A. (ND) SONYMA Optional Add-On Features. Retrieved from
  4. N.A. (ND) Energy Star Labeled Homes. Retrieved from