Buying your first home in Virginia can feel overwhelming—but it doesn’t have to be. With powerful state-backed programs from Virginia Housing (formerly VHDA) and personalized guidance from Federal Hill Mortgage, first-time buyers can access grants, tax credits, and low-interest financing that make homeownership affordable.
Federal Hill Mortgage helps first-time buyers in Richmond, Arlington, Norfolk, and beyond tap into the best mortgage solutions available in 2025.
What Is Virginia Housing (Formerly VHDA)
Virginia Housing is the state’s housing finance agency, created to help Virginians attain affordable, quality housing. Formerly known as the Virginia Housing Development Authority (VHDA), it provides funding and assistance programs for eligible homebuyers across the state.
Their mission? Help first-time buyers with financial tools and education so more people can call Virginia home.
What First-Time Homebuyer Programs Does Virginia Offer?
Virginia Housing offers several powerful programs to make homeownership more accessible:
Virginia Down Payment Assistance Grant
- Benefit: Up to 2.5% of the purchase price to help with your down payment.
- Eligibility:
- First-time buyer or haven’t owned a home in 3+ years
- Meet Virginia Housing income and sales price limits
- Minimum 620 credit score
- Apply Through: Approved lenders like Federal Hill Mortgage
Virginia Closing Cost Assistance Grant
- Benefit: Up to 2% of the purchase price toward closing costs
- Eligibility:
- Must be used with a Virginia Housing mortgage product
- Same income and credit requirements as DPA
- Completion of a homebuyer education course
- Apply Through: Directly through your lender
Mortgage Credit Certificate (MCC)
- Benefit: A dollar-for-dollar federal tax credit worth up to $2,000 per year
- Eligibility:
- Available with Virginia Housing loans
- Subject to income and purchase limits
- Must live in the home as your primary residence
- Apply Through: When applying for your loan
Who Qualifies for Virginia First-Time Buyer Assistance?
Eligibility depends on a few key factors:
- First-Time Buyer: You haven’t owned a home in the past 3 years
- Income & Purchase Price Limits: These vary by region and household size. For example, Northern Virginia has higher thresholds, sometimes exceeding $130,000.
✅ To check your county’s exact limits, visit the Virginia Housing Eligibility Lookup Tool. - Minimum Credit Score: Usually 620, but higher scores offer better terms
- Homebuyer Education: Required for grant eligibility (free online courses available)
Eligibility depends on a few key factors:
- First-Time Buyer: You haven’t owned a home in the past 3 years
- Income & Purchase Price Limits: These vary by region and household size. For example, Northern Virginia has higher thresholds, sometimes exceeding $130,000.
✅ To check your county’s exact limits, visit the Virginia Housing Eligibility Lookup Tool. - Minimum Credit Score: Usually 620, but higher scores offer better terms
- Homebuyer Education: Required for grant eligibility (free online courses available)
How Do You Apply for These Programs?
You must work with a Virginia Housing-approved lender like Federal Hill Mortgage. Here’s how it works:
- Get Preapproved: We help you determine which programs you qualify for.
- Complete Homebuyer Education: Usually done online in 6–8 hours. Virginia Housing’s approved course is free and covers topics like budgeting, mortgage terms, and the homebuying process. You can register through Framework or other VH-approved platforms.
- Submit Required Docs: Pay stubs, W-2s, credit check.
- Receive Grant Funds: Applied at closing to reduce your upfront costs.
You must work with a Virginia Housing-approved lender like Federal Hill Mortgage. Here’s how it works:
- Get Preapproved: We help you determine which programs you qualify for.
- Complete Homebuyer Education: Usually done online in 6–8 hours. Virginia Housing’s approved course is free and covers budgeting, loan types, and buying steps. Register via Framework
- Submit Required Docs: Pay stubs, W-2s, credit check.
- Receive Grant Funds: Applied at closing to reduce your upfront costs.
Do You Have to Repay the Grants?
Great news: Virginia’s Down Payment Assistance Grant and Closing Cost Assistance Grant do not require repayment, as long as you meet the program’s terms. These are true grants, not loans.
Caution: If you’re using the Mortgage Credit Certificate (MCC), you may owe a recapture tax under specific conditions (like selling too early). Consult your tax advisor for details.
How Do Virginia Housing Loan Rates Compare?
Virginia Housing loans often feature below-market interest rates, especially for qualified first-time buyers. These can be lower than conventional or FHA rates, depending on the market.
To view current rates, visit the Virginia Housing Rate Page or request a quote from Federal Hill Mortgage.
Can You Use These Programs with FHA, VA, or Conventional Loans?
Yes, you can! Virginia Housing programs work with a variety of loan types including:
However, these must be Virginia Housing-approved versions of those products. That’s where Federal Hill Mortgage comes in—we help you pair the right loan type with the right grant or credit.
Are There Local Down Payment Programs in Virginia?
In addition to statewide support, several cities and counties offer their own assistance:
Richmond
- Program: Homebuyer Assistance Program
- Benefit: Up to $20,000 in forgivable funds
- Income Limits: Typically 80% of area median income (AMI)
Arlington
- Program: Moderate Income Purchase Assistance Program (MIPAP)
- Benefit: Deferred, no-interest loans for qualified buyers
- Focus: Helps buyers stay in high-cost areas
Norfolk
- Program: Neighborhood Incentive Programs
- Benefit: Closing cost help, rehab funds
- Unique Perk: Tied to revitalization zones for added incentives
Virginia Homebuyer Program Comparison Table
Here’s how the key Virginia programs compare:
Program | benefit type | max assistance | education required | income limits |
|---|---|---|---|---|
DPA Grant | Down Payment | Up to 2.5% | Yes | Yes |
Closing Cost Grant | Closing Cost | Up to 2% | Yes | Yes |
Mortgage Credit Certificate (MCC) | Tax Credit | Up to $2,000/year | Yes | Yes |
Why Work with Federal Hill Mortgage?
When it comes to Virginia Housing programs, not all lenders are created equal. Here’s why homebuyers across Virginia trust Federal Hill:
- Local market expertise across VA, MD, DC, PA, DE, NC, TX
- Program stacking strategies to maximize savings
- Fast, personalized preapprovals
Frequently Asked Questions (FAQ)
What is the income limit for Virginia first-time homebuyer programs?
Income limits vary by county and household size. For example, in Northern Virginia, limits can exceed $130,000. Your lender will check your eligibility.
How do I qualify for the Virginia DPA Grant?
You must be a first-time buyer, meet income/purchase price limits, complete a homebuyer class, and use a qualifying mortgage.
Can I combine the MCC with other programs?
Yes! You can use the MCC alongside down payment and closing cost grants.
What credit score is needed for VHDA loans?
The minimum is generally 620, but 640+ improves your chances of approval and better rates.
Does Virginia offer help with closing costs?
Yes. Virginia Housing’s Closing Cost Grant provides up to 2% assistance when paired with an eligible loan.
Are first-time buyer programs available in Northern Virginia?
Yes. Northern Virginia counties like Fairfax, Loudoun, and Arlington are eligible for Virginia Housing programs—though income limits are higher.
How long does it take to get approved?
Once you submit your documents and complete education, preapproval can happen in 24–48 hours.
Do I need to take a homebuyer class?
Yes. All grant recipients must complete a VH-approved course, typically available online.
What is the MCC tax credit and how does it work?
The MCC provides a federal tax credit of up to $2,000 annually—reducing your tax bill, not just your taxable income.
How do I apply through Federal Hill Mortgage?
Start by requesting a free consultation. We’ll walk you through eligibility, required documents, and next steps.
Explore Your Loan Options
Not sure which loan type fits your goals? Learn more about:
Ready to See What You Qualify For?
First-Time Homebuyer in Virginia?
At Federal Hill Mortgage, we help Virginia buyers access down payment grants, tax credits, and affordable loan programs with expert guidance every step of the way. As a Virginia Housing-approved lender, we make your first home purchase faster—and more affordable—than you might think.
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