By Hans Fetterhoff, Mortgage Broker, NMLS# 273273 — Broker House Mortgage, Colorado Springs
CHFA down payment assistance helps Colorado Springs buyers cover their down payment and closing costs through a CHFA first mortgage: choose a grant of up to 3% of your loan that you never repay, or a deferred second mortgage of up to 4% that comes due when you sell, refinance, or pay off the home. CHFA is the Colorado Housing and Finance Authority, and its programs run through local participating lenders — including Broker House Mortgage, right here in Colorado Springs. This page explains how the assistance actually works in El Paso County, with the current limits, in plain English.
Last verified: October 26, 2026. The CHFA figures on this page were checked against CHFA’s published program documents on that date. Limits and terms change — we confirm your exact numbers when you apply.
Ready to skip ahead? Call Hans at (719) 686-3652 or start your application online.
It’s your choice of two very different kinds of help, and the choice matters more than most buyers realize. Both options must pair with a CHFA first mortgage, both are calculated as a percentage of your first mortgage loan amount (not the purchase price), and you can take one or the other — never both on the same loan:
CHFA Down Payment Assistance Grant: up to the lesser of $25,000 or 3% of your first mortgage. This is a true grant — no repayment, ever. It does not become a lien you owe later.
CHFA Down Payment Assistance Second Mortgage Loan: up to the lesser of $25,000 or 4% of your first mortgage. This is a real loan with no monthly payments: the balance is deferred until you pay off your first mortgage, sell or refinance the home, or stop living there as your primary residence — then it’s due. (Buyers in CHFA’s programs for first-generation homebuyers or buyers living with a permanent disability can access up to the full $25,000 regardless of first mortgage size.)
The decision math, on a labeled example. Say your first mortgage is $400,000 (illustrative only — your loan will differ):
Grant: 3% × $400,000 = $12,000 of help, and you owe nothing later.
Second mortgage: 4% × $400,000 = $16,000 of help — $4,000 more cash at closing — but a $16,000 balance comes due the day you sell, refinance, or pay off the loan.
So the real question isn’t “which is bigger?” It’s “do I want less help with a clean exit, or more help with a bill waiting at the exit?” Buyers who expect to move or refinance in a few years often prefer the grant; buyers who are stretched thinnest at closing sometimes need the second. We run both against your actual numbers before you choose.
One disclosure CHFA itself makes, stated plainly here: higher interest rates apply when you use CHFA assistance — the same CHFA first mortgage without assistance is priced differently. That’s a reason to compare the whole transaction, not a reason to avoid the help: for most assistance buyers, the cash-to-close problem is the one that decides whether they buy at all.
The percentages above are the ceiling. The assistance can be applied to your down payment and your closing costs — the two buckets that make up your cash to close. A few mechanics worth knowing before you budget around it:
You still bring some of your own money. CHFA requires a Minimum Financial Investment of $1,000 from you toward the purchase, on top of whatever down payment or closing costs remain after assistance. Gift funds from family or other eligible sources can count toward that $1,000.
Assistance is sized to the loan, not the need. On an FHA purchase, the minimum down payment is 3.5% of the price — on a $400,000 home that’s $14,000 before closing costs. A 3% grant on the resulting loan covers most of the down payment but not all of it, and closing costs sit on top. The honest picture: CHFA help shrinks your cash to close dramatically; it rarely erases it. We budget your true number with you up front — no surprises in the final week. (Run a first pass on our mortgage calculators, then let us pressure-test it.)
You can put more money down and still use CHFA. Bringing a bigger down payment doesn’t disqualify you from a CHFA first mortgage or its assistance.
The $25,000 caps rarely bind in El Paso County. The grant cap only bites on loans above about $833,000 and the second-mortgage cap above $625,000 — above the FirstStep purchase price limit here anyway. For most Colorado Springs buyers, the percentage is your number.
CHFA eligibility is a checklist, and most of it is more reachable than buyers expect:
Income limits — El Paso County (CHFA limits effective June 15, 2026):
| CHFA program group | Income limit | Purchase price limit |
|---|---|---|
| FirstStep / FirstGeneration — most areas (“non-targeted”) | $127,800 (1–2 person household) / $146,970 (3+ person), gross annual income | $566,730 |
| FirstStep / FirstGeneration — federally designated targeted areas | $153,360 (1–2 person) / $178,920 (3+), gross annual income | $692,670 |
| SmartStep, Preferred, HomeAccess, Schools To Home and related programs | $178,920 qualifying income, any household size | No purchase price limit — but your total loan can’t exceed the lower of $832,750 or your loan type’s own limit |
Certain census tracts in El Paso County are designated targeted areas with the higher limits — we check the specific address you’re buying, because the same street can sit on either side of a tract line. Note the two different income rulers: FirstStep measures your gross household income, while SmartStep and its sibling programs measure qualifying income — the income your lender actually uses to qualify you. That distinction alone moves some households from “over the limit” to “in.”
The rest of the checklist (per CHFA):
Credit score: every borrower needs a mid-credit score of 620 or better (CHFA notes there may be exceptions for borrowers with no credit score at all). Debt-to-income guidelines run to 50% with scores of 620–659 and 55% at 660+.
Homebuyer education: required for every borrower on a CHFA first mortgage, completed before closing, from a CHFA-approved provider. In-person classes are free; online options exist. Take it early — it’s genuinely useful, and leaving it to the last week helps no one.
First-time buyer status depends on the program. FirstStep is built for first-time buyers. SmartStep, Preferred, and Schools To Home carry no first-time buyer requirement — repeat buyers use them every day.
The home must be your primary residence, and you must buy through a CHFA Participating Lender. CHFA doesn’t lend to the public directly; its network is 100+ participating lenders statewide, and Broker House Mortgage is one of them.
The assistance is the passenger; the CHFA first mortgage is the vehicle. The main programs we run in Colorado Springs:
CHFA FirstStep — the first-time buyer flagship. Government (FHA/VA/USDA) and conventional versions; the county income and purchase price limits above apply.
CHFA SmartStep — the flexible sibling: no first-time buyer requirement, the flat $178,920 qualifying income limit, no purchase price limit. Government and conventional versions.
CHFA Preferred — conventional (Fannie Mae) first mortgages, including a Very Low Income Program tier; same $178,920 qualifying income framework.
CHFA HomeAccess — for buyers living with a permanent disability, with its own assistance path (up to $25,000 regardless of first mortgage size).
CHFA FirstGeneration — for first-generation homebuyers (your parents or guardians never owned a home), with the flat $25,000 assistance access; FirstStep-style county limits apply.
CHFA Schools To Home — the school-employee program, covered in its own section below.
CHFA Colorado Champions — the first-responder program (a fixed-rate first mortgage packaged with the DPA second mortgage), covered in its own section below.
Most of these come in a standard version and a “Plus” version — Plus is the program packaged with down payment assistance. Government or conventional: the assistance math is the same either way; which first mortgage fits you depends on credit, down payment, and the property. One El Paso County detail for FHA buyers: the 2026 FHA loan limit here is $541,650 (before financed upfront mortgage insurance), and CHFA caps your total CHFA loan at the lower of $832,750 or your loan program’s own limit.
CHFA isn’t the only assistance in town, and a participating-lender broker’s job includes telling you when a different program fits better. The honest comparison, as of October 26, 2026:
| CHFA Grant | CHFA Second Mortgage | Pikes Peak DPA (PPDPA) | CHAC | |
|---|---|---|---|---|
| Who runs it | Colorado Housing and Finance Authority, through participating lenders | Same | El Paso County Housing Authority | Colorado Housing Assistance Corporation (statewide nonprofit) |
| How much | Lesser of $25,000 or 3% of first mortgage | Lesser of $25,000 or 4% of first mortgage | Up to 5% of the loan amount — plus a 1% Hometown Heroes grant for the first teachers, firefighters, law enforcement, medical professionals, military, and Veterans to use the program | 6% of sales price or appraised value (whichever is less), up to $12,000 |
| Repayment | Never repaid | No monthly payments; full balance due when you pay off, sell, refinance, or move out | 0% interest, no monthly payments; 50% forgiven over the first 5 years, the remaining 50% forgiven at the end of the 30-year term | Repayable loan, with interest: pay monthly from the start (3% interest), or defer 5 years at 0% then repay over 25 years at 5%. (Separate disability program: up to $10,000, 0%, deferred 30 years, due on sale or transfer.) |
| First mortgage it pairs with | A CHFA first mortgage (FHA, VA, USDA, or conventional) | A CHFA first mortgage | FHA, VA, USDA, or Freddie Mac HFA Advantage conventional — 30-year fixed, through PPDPA’s participating lenders | Conventional or FHA first mortgages — does not require a CHFA first mortgage |
| Credit floor | 620 mid-score | 620 mid-score | 640 minimum | Set by your first mortgage and CHAC’s guidelines |
| Income limit (El Paso) | CHFA table above | CHFA table above | $174,440 (FHA/VA/USDA); $90,720 (conventional) | Varies by county, household size, and first mortgage — lower-to-moderate income focus |
| First-time buyer required? | Depends on the CHFA first mortgage (FirstStep yes; SmartStep no) | Same | No | Yes — CHAC serves first-time homebuyers |
| Education required? | Yes — CHFA-approved class, all borrowers, before closing | Yes | No counseling requirement | Yes — a first-time homebuyer class |
How to read this table: If you want help you’ll never owe back and your income fits the CHFA limits, the grant is hard to beat. If you need maximum cash at closing and don’t mind a deferred balance, compare CHFA’s 4% second against PPDPA’s 5% forgivable structure — PPDPA forgives on a schedule rather than coming due all at once, but it caps income lower on conventional loans and doesn’t ride on a CHFA first mortgage. CHAC is the smallest dollars and the only option here that puts you on a monthly repayment right away, but it works without a CHFA loan, which occasionally makes it the piece that fits an unusual file. Whether two programs can combine on one purchase depends on each program’s rules and your first mortgage — that’s a case-by-case map we draw with you, not a promise we print.
The bigger comparison — including Colorado Roots (Colorado Springs and Manitou Springs only), the Rocky Mountain Community Land Trust, and the programs that do not apply in El Paso County at all — lives on our down payment assistance page.
If you work full-time for a Colorado public school, this is the most generous assistance structure CHFA runs — and the one with the most important fine print. CHFA Schools To Home was authorized by the Colorado General Assembly and is funded by investment from the Public School Permanent Fund. It’s built to help public school employees buy homes in the communities where they teach and work:
Who qualifies: any full-time employee of a preK–12 Colorado public school, school district, charter school, institute charter school, board of cooperative educational services, or innovation zone — teachers, yes, and also the staff around them. Your lender documents eligibility with a paystub or employer verification.
The assistance: a second mortgage of up to 25% of your first mortgage loan amount — on a $350,000 first mortgage, that’s up to $87,500 of down payment and closing cost help, paired with a CHFA fixed-rate first mortgage. The program uses the $178,920 qualifying income limit and has no purchase price limit (your total loan is still capped at the lower of $832,750 or your loan type’s limit).
The shared appreciation catch — stated plainly, the way CHFA states it: this is not a grant. You repay the second mortgage plus a share of your home’s appreciation to the Public School Permanent Fund. The shared percentage is tied to how much assistance you received (it can never exceed that percentage). Both payments are deferred — due at the end of the loan term or earlier if you pay off the first mortgage, sell, refinance, or stop living in the home. In CHFA’s own worked example, a borrower who received $87,500 on a $437,500 purchase and later sold for $480,000 owed the $87,500 back plus $10,625 of shared appreciation. If the home doesn’t appreciate, there’s no appreciation to share.
Required courses: the program’s own “Understanding Your Financial Commitment” course, in addition to CHFA-approved homebuyer education.
Hans teaches CHFA programs — Schools To Home included — to Colorado Springs real estate agents in continuing-education classes, so if your agent has sat in one of his sessions, this program may already be on their radar. If you’re a school employee, bring it up on our first call: the trade (much more help now, a share of appreciation later) is worth it for many staff buyers and wrong for some, and it deserves a real conversation, not a brochure.
Colorado’s newest CHFA program was built for the people who run toward the emergency. CHFA Colorado Champions — created by Colorado state law (SB26-053) — pairs a fixed-rate CHFA first mortgage with down payment assistance for eligible first responders and law enforcement, so they can live in the communities they serve. It carries a single statewide borrower income limit of $196,810 — higher than any of the standard CHFA limits on this page.
Who qualifies — and the list is broader than patrol: P.O.S.T.-certified peace officers and non-certified deputy sheriffs; emergency communications specialists (the dispatch side counts); corrections officers; port of entry officers; and wildlife officers — plus firefighters and emergency medical technicians. Only one borrower on the loan has to be a Champion.
You must work here: eligible borrowers must be employed by a Colorado employer and work in Colorado. We document your eligibility the way CHFA requires — a certification, a current paystub, a written verification of employment, or similar employer-issued paperwork.
The assistance: a CHFA DPA second mortgage of up to the lesser of $25,000 or 4% of your first mortgage — the same deferred second described at the top of this page. No monthly payments; the balance comes due when you pay off the first mortgage, sell, refinance, or stop living in the home as your primary residence.
The rest of the checklist matches CHFA’s foundation: a mid-credit score of 620 or higher, the CHFA-approved homebuyer education class completed by every borrower before closing, and your $1,000 minimum contribution toward the purchase.
The honest limit: this program is occupation-restricted by law. If nobody on your loan works in one of the listed roles, Champions isn’t available to you — but the standard CHFA grant and second mortgage above may be, and we check both on the same call.
If you wear the uniform — or carry the radio, staff the jail, or run the calls — tell us on the first conversation. Champions changes which income limit applies to you, and it’s new enough that many lenders haven’t built it into their intake yet. We have.
Yes for the first mortgages themselves — CHFA’s assistance pairs with the CHFA version of an FHA, VA, USDA, or conventional loan, and this is where Colorado Springs buyers have an edge most lenders don’t explain well:
VA buyers: a VA loan already covers the down payment — it’s $0 down. What it doesn’t cover is closing costs, and that’s exactly where CHFA assistance can go on a CHFA VA first mortgage. If you’re PCSing to Fort Carson, Peterson, or Schriever and cash is tight after a move, this stack is worth a look. The full VA picture — entitlement, funding fee, BAH math — is on our VA loans page.
FHA buyers: the classic CHFA pairing. FHA’s 3.5% minimum down payment is the hurdle the assistance was designed around; on many El Paso County purchases the grant or second covers most or all of that 3.5% plus part of closing costs, with your $1,000 minimum contribution and any remainder as your cash to close. New appraisal rules (UAD 3.6) arriving November 2, 2026 make the FHA side of this worth an early conversation if you’re buying this fall.
One assistance option per CHFA loan: grant or second — CHFA’s rule, not ours. And assistance from different organizations (CHFA vs. the county’s PPDPA vs. CHAC) has its own combination rules; we verify what can layer on your specific file before anyone counts the money twice.
Buying your first home and want the whole path, not just the financing? Our Colorado Springs first-time buyer guide walks it step by step.
“CHFA money is free money.” Only the grant is — and it’s the smaller option. The second mortgage is a loan: deferred is not forgiven. If a lender blurs that line for you, get a second opinion.
“I’ll just refinance out of it later.” Read the trigger events first. Refinancing a non-CHFA loan means the CHFA second comes due in full; the one narrow resubordination path (into a CHFA FHA Streamline, once) is the exception, not the plan.
“Assistance means zero cash to close.” CHFA itself requires your $1,000 minimum investment, and assistance is a percentage of the loan — not a blank check for every cost. Budget the real remainder with us before you offer.
“I make too much / my credit isn’t good enough.” The SmartStep income ceiling is $178,920 in qualifying income — higher than most buyers guess — and the credit floor is 620, not 700. Check before you self-reject.
Recapture tax (the obscure one): loans under certain CHFA programs are funded with tax-exempt financing and can be subject to a federal recapture tax if you sell within nine years, at a gain, after a significant income increase — all three conditions together. It’s uncommon and it’s plannable, but you should hear it from us now, not from a tax form in 2031.
Limits move. CHFA republishes income and purchase price limits (most recently effective June 15, 2026) and program terms change. That’s what the “Last verified” date at the top of this page is for — and why we re-verify your numbers at application, not from memory.
CHFA only works through participating lenders. You can’t apply at CHFA directly. The lender you pick is the program experience — the eligibility calls, the education timing, the CHFA compliance review, the reservation of your assistance funds.
Hans teaches CHFA to the agents. Hans Fetterhoff sponsors and teaches continuing-education classes on CHFA programs for Colorado Springs real estate agents. When your lender is the person other professionals learn these programs from, the stacking rules and county limits aren’t research — they’re the syllabus.
We’re a brokerage, not a single lender. Broker House Mortgage shops multiple wholesale lenders for the loans around your CHFA file and can route a file to the structure that fits — CHFA grant, CHFA second, PPDPA, or a non-CHFA loan entirely — instead of fitting you into the one program a single-channel lender happens to sell.
There’s an office. 529 N Tejon St in downtown Colorado Springs. Hans has 20+ years in the mortgage business, has lived in Colorado Springs for over 20 years, and has helped thousands of families into homes — many of them with CHFA assistance in El Paso County’s neighborhoods, from Fountain and Security-Widefield to Briargate and the west side.
Call (719) 686-3652 and talk with Hans about which CHFA program — and which assistance option — fits your numbers.
Or start the application online; we’ll run the CHFA eligibility check as part of the review.
School employee? Ask about Schools To Home by name.
Read more about Hans on his loan officer page.
You’re Better Off With Fetterhoff.
By Hans Fetterhoff, Mortgage Broker, NMLS# 273273 — Broker House Mortgage
Educational information only — not a commitment to lend. All loans are subject to credit review, underwriting approval, and property appraisal. CHFA programs are offered through CHFA Participating Lenders; CHFA does not lend directly to borrowers. Program terms, assistance amounts, income limits, and purchase price limits shown were verified at the sources noted on October 26, 2026, and can change — confirm current terms when you apply. Using CHFA down payment assistance may result in a higher interest rate on your first mortgage, as disclosed by CHFA.
Hans Fetterhoff | Mortgage Broker | CO License #100009597 | NMLS# 273273
Lender Works, LLP dba Broker House Mortgage | Company NMLS# 2002619
529 N Tejon St, Colorado Springs, CO 80903 | 719-686-3652 | brokerhousemortgage.com
Regulated by the Division of Real Estate
Equal Housing Opportunity
Verify licensing at NMLS Consumer Access: www.nmlsconsumeraccess.org
