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Down Payment Assistance Program Guidelines

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The following provides information regarding requirements and guidelines for the Boulder County Down Payment Assistance Program. For any questions please contact Molly McElroy at, or (303) 774-4648.

Program Requirements

Click on link for detailed descriptions of requirements

Meet Income guidelines

Income re-certification (after 6 months)

Qualify for a first loan (mortgage)

Submit application fee

Must be a first-time homebuyer

Complete a Home Ownership Training Course

Attend a one-on-one budget session (prepurchase counseling)

Owner-occupy property

Home must pass a property inspection

Complete a property appraisal and provide copy

Contribute at least $2,000; or 1% of purchase price, whichever is greater, of own funds

Meet asset limits

Total property debt requirements

Complete Owner's Acknowledgement of Acquisition form

Non-occupying co-borrower allowed

Income Guidelines -- Annual household income from all sources for all household members cannot exceed 80% of The U.S. Dept. of Housing and Urban Development’s (HUD) Area Median Income. Income from all household members is considered regardless of who is listed on the title and/or mortgage. Click here to view the current year’s income limits for Boulder County. If a borrower has a non-occupying co-borrower on their first loan that co-borrower's income will not be counted if that person provides a signed statement verifying that they will not occupy the property and will not contribute to the household expenses. All co-borrowers will be listed on the City of Longmont's promissory note for the loan and will be legally responsible for the repayment of the loan. A co-borrower may not be listed on the purchase contract as a buyer or on the title of the property.

Gross income is the combined household income which includes, but is not limited to, job earnings, Social Security and Social Services income (for all in household), TANF, VA benefits, unemployment income, military pay, worker’s compensation payments, child support, alimony/maintenance payments, income from pensions or retirement plans, stocks, etc. Employment income will be counted for all household members (age 18 and older) who will live at the property. Income in excess of $450 for full time student over the age of 18 will be excluded from income calculations. This limit does not apply to a student who is the head of household or their spouse. When this is the case, their full income must be counted. Failure to report household income is considered fraud and can have serious consequences, including disqualification from program.

Income Calculation -- A “snapshot” of current income is taken at the time the application is submitted (based on current month’s pay stubs, a verification of employment completed by the applicant’s employer, and year-to-date earnings and documentation of all other sources of income), and is projected for the next 12 months. All known and/or anticipated income to be received throughout the year including bonuses, pay raises, etc. must be disclosed. Failure to report all household income is considered fraud and can have serious consequences, including disqualification from program.

Asset Guidelines -- Assets include, but are not limited to, checking and savings accounts, money market accounts, and retirement accounts. An applicant may not have more than 80% of the area median income in assets including down payment. Note: retirement accounts, such as IRA, 401K, stocks, etc. are considered assets, however, withdrawal penalties and taxes may be taken into consideration with written documentation. The interest/dividends from retirement accounts is added to the income calculation.  Click here to view the current year's asset limits.

Income/Asset Re-certification after 6 months -- Recertification must occur for down payment assistance applicants who have not closed on a property within six months of initial eligibility approval. Recertification is required regardless of whether a purchase contract has been signed and will occur every six months until closing. If an applicant is deemed over the income and asset limits after recertification, down payment will not be provided.

First Loan -- An applicant must qualify for a first mortgage, with a lender of their choice, large enough to purchase the intended property. The City of Longmont does not accept subprime loans, interest-only loans, or adjustable-rate mortgages. Program staff reserves the right to deny eligibility based on the terms of any loan.

Total Property Debt -- The total housing debt on a property at the time of closing may not be more than 100% of the value of the home. Total debt includes first mortgage and all subordinate financing. The value of the home is the purchase price of the home unless the appraised value is higher than the purchase price. Home may not be purchased for above the appraised value. Homebuyers may be required to contribute more than the minimum program requirement (see below).

Application Fee -- A nonrefundable $25 processing fee is required for all applicants. The check should be made payable to the City of Longmont. Cash and credit cards are not accepted.

First Time Homebuyer -- An applicant interested in down payment assistance must be a first-time homebuyer. A first-time homebuyer is defined as a person who has not owned a property for the past 3 years. Exceptions are made for newly-divorced single persons/parents (within the past 3 years).

Home Buyer Training Course -- All applicants must attend a CHFA-approved homebuyer training course. In Boulder County, this is a free one-day course that covers working with real estate agents and lenders, credit issues, contracts and inspections, home maintenance, and budgeting. It must be completed before a purchase contract is signed for the Boulder County Down Payment Assistance Program. Registration is required, .

One-on-One Budget Session (Prepurchase Counseling) -- Once an applicant is determined to be income and asset-eligible, they will meet with a housing counselor. The counselor will review the first and second (DPA) mortgages to ensure the terms are understood and the loans are in compliance with City guidelines. The applicant must bring to this meeting, a completed Form 1003 (loan application), Good Faith Estimate, Truth- in-Lending statement, a current budget, and a budget showing your future financial situation. The City of Longmont does not accept subprime loans, interest-only loans, and adjustable-rate mortgages. Program staff reserves the right to deny eligibility for an applicant based on a negative recommendation by the housing counselor or on the terms of your loan. If you are denied eligibility, the housing counselor will work with you to determine an action plan so you may qualify for the program in the future.

Owner Occupancy -- All homes purchased with assistance from the Down Payment Assistance Program must be the sole residence of the buyer, be continuously occupied, and may not be rented. Staff will verify your occupancy every year. If you are no longer living there, the remaining balance of any loan on the property will be invoked. You may not own any other habitable property in addition to this property.

Property Inspection -- A property receiving down payment assistance funds must be determined safe and habitable by the City prior to closing. Once an applicant’s final eligibility has been determined, the City will schedule its inspection. Any safety and health hazards and all Housing Code violations listed in the report, as determined by the Uniform Housing Code, must be fixed and documentation of the repairs provided to the City of Longmont before closing. Down Payment Assistance funds may not be used to cover the cost of repairs. 

If inspection issues are unable to be fixed, the property will be determined ineligible for the Down Payment Assistance Program. 

In some circumstances, money may be allowed to be escrowed for the repairs to be conducted after closing but before occupancy. Prior approval from the City is required. Immediate health and safety issues are ineligible. If any funds are being escrowed for repairs, the home must appraised for at least the amount of the first mortgage and Down Payment Assistance loan.

Please note that while the City will share a copy of the inspection report with the homebuyer, it is still the responsibility of the homebuyer to inspect the home for issues important to them. Homebuyers are encouraged to have their own inspection done to protect their interest. The City of Longmont Affordable Housing program is not liable for the condition of any property at the time of purchase or for any issues that may arise after purchase.

Lead-Based Paint -- If a property was built before 1978, the property must pass a visual inspection for any chipped, pealing, flaking or otherwise deteriorating paint (required form provided by the City of Longmont). If there is deterioration, the house must be tested for lead-based paint. If the home tests positive for lead-based paint, the paint must be stabilized prior to closing and occupancy.

Property Appraisal -- An appraisal must be completed on all properties and submitted to the City of Longmont before closing. The purchase price may not exceed the appraised value of the property. For 203(k) loans (rehab loans) or situations where money is being escrowed for repairs to be conducted after closing, the appraised value must equal the total of the first mortgage and down payment assistance loan.

Minimum $2,000 or 1% of the of the home Contribution -- Home buyers must contribute at least $2,000, or 1% of the purchase price (whichever is greater) to the purchase transaction. This is usually put in the form of earnest money; however, other fees such as inspection and appraisal payments may be considered. A lender and/or development may require more. A homebuyer may not receive any cash back at closing even if they put more than the required minimum of $2,000 down.

Owner's Acknowledgement of Acquisition Form -- This form verifies that the property was either vacant or owner-occupied at the time the contract was signed and must be signed by buyer and the seller. A completed form must be provided to the Affordable Housing Program staff prior to closing. Down payment assistance may not be used for buyers purchasing properties that displace, or otherwise involves tenants.

Non-Occupying Co-Borrower -- Co-borrowers may be accepted. The co-borrower must provide a written signed statement verifying that they will not reside at that property, and their income will not be counted. All co-borrowers will be listed on the promissory note for the loan and will be legally responsible for the repayment of the loan. Co-borrowers may not be listed on the purchase contract or the title of the property.

Legal Documents – All homebuyers receiving a Down Payment Assistance loan will sign a deed of trust and promissory note at closing accepting the terms of the loan. The deed of trust will be recorded with the Boulder County Clerk and Recorder’s Office as a lien against the property. The lien will be released once the loan has been repaid in full. 

Contact Information

Contact Molly McElroy with any questions.

TDD service for those individuals with hearing and speech disabilities is available through Colorado Relay Service at 1-800-659-3656.

Equal Opportunity

In accordance with the provisions of the Equal Opportunity Act and the Program's policies, there will be no discrimination against an applicant for these funds on the basis of age, source of income, sex, race, marital status, sexual orientation, national origin, religion or handicap. If you need special accommodations to enable you to apply for, or to access this assistance, please call 303-774-4339.

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