By Robert DeFalco, Licensed Real Estate Broker | Last Updated: October 2025
Purchasing your first home in the New York or New Jersey metro area represents both an exciting milestone and significant financial undertaking. With median home prices exceeding $540,000 in New Jersey and $400,000-plus throughout much of New York State, saving for a down payment and closing costs can feel overwhelming. Fortunately, dozens of federal, state, and local programs exist specifically to help qualified buyers overcome these financial hurdles.
At Robert DeFalco Realty, we’ve helped hundreds of first-time buyers navigate down payment assistance programs across Staten Island and the greater NYC/NJ region. With over three decades of local market expertise, our team understands how to match buyers with programs that maximize purchasing power while minimizing upfront costs.
Understanding First-Time Home Buyer Status
Who Qualifies as a First-Time Buyer?
The U.S. Department of Housing and Urban Development defines a first-time homebuyer as anyone who has not owned a principal residence in the past three years. This expanded definition means many more people qualify than initially realize.
You qualify if:
- You have never owned a home
- You have not owned a primary residence in the last three years
- You are a single parent who only owned with a former spouse
- You only owned property not attached to a permanent foundation
Expert Insight: In my thirty years selling Staten Island real estate, I regularly work with clients who assume they don’t qualify because they owned a home five or ten years ago. When they discover they meet the three-year rule, it opens access to programs providing $15,000 to $100,000 in assistance.
New York State First-Time Home Buyer Programs
SONYMA (State of New York Mortgage Agency)
SONYMA serves as the primary state resource, offering competitive mortgage financing and down payment assistance throughout New York State.
SONYMA Low-Interest Mortgages
SONYMA provides 30-year fixed-rate mortgages with interest rates typically 0.25% to 0.75% below market rates. These work with FHA, VA, USDA, and conventional loans.
Eligibility requirements:
- No ownership in past three years
- Purchase price within county limits ($370,000-$625,000 depending on location)
- Income limits vary by county (generally 80%-140% of area median income)
- Credit score minimum 620-640
- Property must be primary residence in New York State
- Eligible properties: 1-4 family homes, condos, co-ops, manufactured homes
SONYMA Down Payment Assistance (DPAL)
SONYMA offers down payment assistance as a second mortgage with no monthly payments and zero interest. After ten years, these loans are completely forgiven.
SONYMA DPAL structure:
- Up to 3% of purchase price (maximum $15,000)
- Can be used for down payment, closing costs, or PMI buydown
- Zero interest, no monthly payment
- Forgiven after 10 years
- If you sell before 10 years, repay 1/120th monthly
Real-World Example: A buyer purchasing a $450,000 Staten Island home receives $13,500 through SONYMA DPAL, plus below-market interest rates saving $75-$125 monthly.
NYC HomeFirst Down Payment Assistance
The NYC HomeFirst Program offers the most generous assistance in New York, providing up to $100,000 toward down payment and closing costs in all five boroughs.
Key features:
- Up to $100,000 forgivable second mortgage
- Eligible properties: 1-4 family homes, condos, co-ops in NYC
- Forgiveness: 10 years for loans ≤$40,000; 15 years for loans >$40,000
- Buyer contribution: Minimum 3% from your own funds required
- Housing counseling required through HPD-approved agency
Application process:
- Complete homebuyer education through HPD-approved agency
- Receive certificate of eligibility
- Get pre-approval from participating lender
- Find property and negotiate contract
- Property passes Housing Quality Standards inspection
Staten Island advantage: HomeFirst provides Staten Island buyers extraordinary leverage. While Brooklyn and Manhattan properties often exceed purchase price limits, Staten Island’s relatively affordable inventory means more properties qualify for the full $100,000.
Explore Staten Island homes for sale that qualify for HomeFirst assistance.
Case Study: The Rodriguez family combined SONYMA DPAL ($13,500) with NYC HomeFirst ($75,000) to purchase their first Great Kills home—total $88,500 in assistance that eliminated their down payment requirement and covered most closing costs.
Homebuyer Dream Program
The Homebuyer Dream Program provides grants of up to $30,000 through participating lenders in New York, New Jersey, Puerto Rico, and U.S. Virgin Islands.
Program details:
- Grant amount: $15,000-$30,000 (never requires repayment)
- Income limits: 80% or below area median income
- Equity contribution: Minimum $1,000 of your own funds
- Homebuyer education required
- Retention period: 5 years or repay prorated portion
- Enrollment: Typically December-January annually
Timing note: Program closes within 4-8 weeks of opening due to high demand. Work with participating lenders to submit applications immediately when enrollment opens.
New Jersey First-Time Home Buyer Programs
NJHMFA (New Jersey Housing and Mortgage Finance Agency)
NJHMFA administers all major state-level programs, providing competitive mortgages and substantial down payment assistance.
NJHMFA First-Time Homebuyer Mortgage
30-year fixed-rate government-insured loans (FHA, VA, USDA) with competitive rates and flexible qualification standards.
Requirements:
- First-time buyer status (exceptions for veterans and Urban Target Areas)
- Income limits: 115% of area median income (higher in Urban Target Areas)
- Purchase price limits: $400,000-$625,000 by county
- Credit score 620-640 minimum
- Property must be primary residence in New Jersey
NJHMFA Down Payment Assistance
Up to $15,000 in down payment and closing cost assistance as an interest-free, five-year forgivable second loan.
NJHMFA DPA structure:
- $10,000-$15,000 depending on county
- Zero interest, no monthly payment
- 20% forgiven annually over 5 years
- If you sell before 5 years, repay unforgiven balance
County amounts (2025):
- Essex, Hudson, Passaic, Union: $15,000
- Bergen, Middlesex, Morris, Somerset: $12,000-$14,000
- Most other counties: $10,000-$12,000
NJHMFA First Generation Down Payment Assistance
Additional $7,000 for first-generation homebuyers whose parents/guardians do not own residential property anywhere in the U.S.
Combined power: First-generation buyer in Essex County receives $15,000 (county DPA) + $7,000 (First Generation DPA) = $22,000 total assistance with zero monthly payments.
NJHMFA HFA Advantage Mortgage
Conventional financing alternative with Freddie Mac HFA Advantage loans.
Features:
- 30-year fixed-rate conventional loan
- Down payment as low as 3%
- Lower PMI costs than standard conventional
- Pairs with NJHMFA DPA ($22,000 maximum)
- Credit score minimum: 640
- Income limits: 140% of area median income
Local New Jersey Programs
Newark Live Newark Program: Down payment and closing cost assistance for Newark purchases
Trenton First-Time Homebuyer: Up to $15,000 for down payment/closing costs with income qualifications
Gloucester County DPA: Up to $25,000 in 0% deferred loans; 3% buyer contribution and HUD homebuyer education required
Federal Loan Programs: Low and No Down Payment Options
FHA Loans: 3.5% Down for Most Buyers
Federal Housing Administration loans offer accessible qualification standards and low down payments.
FHA requirements (2025):
- Minimum down payment: 3.5% (580+ credit score); 10% (500-579 score)
- Credit score: 500 minimum (most lenders require 580-620)
- Debt-to-income: Up to 50% with compensating factors
- Mortgage insurance: 1.75% upfront (financed) + 0.15%-0.75% annual
- Property: Primary residence, must pass FHA appraisal
- Loan limits: $524,225 most areas; $1,209,750 high-cost areas
Advantages:
- More lenient credit than conventional
- Gift funds can cover entire down payment
- Seller contributes up to 6% toward closing costs
VA Loans: Zero Down for Veterans
Veterans, active-duty service members, and qualifying spouses can purchase with no down payment.
VA benefits:
- $0 down payment (100% financing)
- No mortgage insurance (no PMI or MIP)
- Funding fee: 2.15%-3.30% (waived for disabled veterans)
- Interest rates 0.25%-0.50% below conventional
- Credit: Flexible (lenders typically require 580-620)
USDA Loans: Zero Down in Rural Areas
U.S. Department of Agriculture guarantees zero-down mortgages in designated rural areas.
USDA requirements:
- $0 down payment
- Property in USDA-eligible area
- Income cannot exceed 115% area median income
- Credit minimum: 640
- Guarantee fee: 1% upfront + 0.35% annual
Conventional 3% Down Programs
Fannie Mae HomeReady:
- 3% down payment
- Income limit: 80% AMI
- Credit: 620 minimum
- Reduced PMI costs
- Homebuyer education required
Freddie Mac Home Possible:
- 3% down payment
- Income limit: 80% AMI
- Credit: 660 minimum
- Similar benefits to HomeReady
Conventional 97:
- 3% down for any first-time buyer
- No income limits
- Credit: 620 minimum
- Single-family and condos only
Down Payment and Closing Cost Basics
Minimum Down Payment by Loan Type
| Loan Type | Min Down Payment | Credit Min | Best For |
|---|---|---|---|
| FHA | 3.5% (580+)<br/>10% (500-579) | 500 | Challenged credit |
| Conventional | 3% | 620-660 | Good credit, first-time buyers |
| VA | 0% | No min | Veterans, military |
| USDA | 0% | 640 | Rural areas |
Typical Closing Costs (NY/NJ)
Total: 2%-5% of purchase price (NYC can be 3%-6%)
Components:
- Loan origination: 0.5%-1%
- Appraisal: $500-$800
- Home inspection: $400-$600
- Title insurance: $1,500-$3,500
- Attorney fees: $1,500-$3,000
- Recording/transfer taxes: Varies
- Prepaid taxes/insurance: 2-6 months
Example on $400,000 purchase:
- Down payment (3.5% FHA): $14,000
- Closing costs (3%): $12,000
- Total cash needed: $26,000
With HomeFirst ($75,000):
- Out-of-pocket: $12,000 (3% minimum contribution)
Strategic Tips for Maximizing Benefits
Stack Programs for Maximum Assistance
NYC buyers (Staten Island):
- SONYMA DPAL: $15,000
- NYC HomeFirst: $75,000-$100,000
- Homebuyer Dream: $15,000-$30,000 Potential total: $105,000-$145,000
New Jersey buyers:
- NJHMFA DPA: $10,000-$15,000
- First Generation DPA: $7,000
- Local program: $10,000-$25,000
- Homebuyer Dream: $15,000-$30,000 Potential total: $42,000-$77,000
Strategy: The key to maximizing assistance is timing your search with program enrollment periods and working with a team that understands program coordination. Many buyers lose access because their agent or lender doesn’t know how to stack programs.
Credit Score Optimization
Target tiers:
- 740+: Best rates, lowest insurance costs
- 680-739: Good rates, most programs accessible
- 620-679: All major programs, higher PMI
- 580-619: FHA available, higher rates
- Below 580: Very limited options
60-90 day improvements:
- Pay cards below 30% utilization (10% ideal)
- Become authorized user on family member’s card
- Request credit limit increases
- Dispute credit report errors
- Avoid new credit during home search
Staten Island First-Time Buyer Advantages
Why Staten Island for First-Time Buyers
Relative affordability: Prices 30%-50% below Brooklyn, Queens, Manhattan—your assistance dollars stretch further
Full NYC access: All NYC programs (HomeFirst up to $100,000) with suburban benefits like yards and parking
Strong schools: Top-rated districts including Staten Island Technical High School (nationally ranked)
Commute options: Express bus, ferry, and railway maintain NYC connectivity at lower costs
Robert DeFalco Realty: Your First-Time Buyer Specialists
At Robert DeFalco Realty, we’ve built our reputation guiding first-time buyers through every step of purchasing.
Why choose us:
- Program expertise: Current knowledge of all federal, state, local programs
- Lender relationships: Direct connections with first-time buyer specialists
- Strategic guidance: We time searches with enrollment periods and stack programs
- Track record: 156 first-time buyers in 2024, average $47,500 assistance secured
“Robert’s team found us $88,000 in assistance we didn’t know existed. We went from thinking we needed two more years to closing in four months.” — Michael and Lisa T., Great Kills, 2024
Start Your Journey Today
Take action:
- Schedule free consultation to discuss eligibility
- Browse Staten Island homes in your range
- Download First-Time Buyer Checklist
📞 (718) 987-7900 | 📧 info@defalcorealty.com | 🌐 www.defalcorealty.com
Frequently Asked Questions
How much money do I need to buy as a first-time buyer?
With programs, you may need as little as $1,000-$5,000. NYC HomeFirst ($100,000) or NJHMFA DPA ($15,000-$22,000) can cover down payment and closing costs. Most programs require some contribution—typically 3% of purchase price. On a $400,000 home, that’s $12,000 from your savings, with assistance covering the rest.
Can I buy with no money down in NY or NJ?
VA loans offer zero down for veterans. USDA provides 0% down in eligible rural areas. You’ll still need closing costs unless you stack with assistance grants or get seller concessions. For non-veterans in urban areas, realistic minimum is 3%-3.5% down plus closing costs, though assistance can cover most expenses.
What credit score do I need?
Most programs require 580-640 minimum. FHA accepts 580+ for 3.5% down. Conventional programs need 620-660. SONYMA and NJHMFA generally require 620-640. Higher scores (680+) get better rates and more program access.
Can I combine multiple programs?
Yes—this creates the most powerful results. Stack SONYMA DPAL with NYC HomeFirst for up to $115,000 in NYC. In New Jersey, combine NJHMFA DPA ($15,000) + First Generation DPA ($7,000) + local programs ($10,000-$25,000) for total $32,000-$47,000. Working with experienced professionals is essential.
Do I have to pay back down payment assistance?
Depends on structure. Many programs (SONYMA DPAL, NJHMFA DPA, NYC HomeFirst) are “forgivable loans”—never repaid if you stay in the home for required period (5-15 years). If you sell/refinance early, you repay a prorated portion. Grants like Homebuyer Dream never require repayment if you meet 5-year occupancy.
What if I owned a home 5 years ago?
You still qualify under the three-year rule. Anyone who hasn’t owned a principal residence in the past three years is considered first-time buyer. If you owned five, ten, or fifteen years ago, you fully qualify for all programs.
Are there income limits?
Most programs have limits, though generous in high-cost areas. SONYMA ranges 80%-140% AMI. NJHMFA generally caps at 115%-140% AMI. In NYC/NJ counties, this often means $100,000-$150,000 household income limits for a family of four. Higher earners can still access FHA, VA, and standard conventional with low down payments.
Can I buy a condo or multi-family?
Yes. Most programs accept condos, townhomes, single-families, and 2-4 unit properties where you occupy one unit. Co-ops eligible under SONYMA and NYC HomeFirst. Multi-families offer powerful strategy—rental income helps qualify you while building wealth.
Complete Application Timeline
Months 1-2: Preparation
- Review credit reports, calculate savings
- Research programs (SONYMA, NJHMFA, HomeFirst)
- Complete homebuyer education (8-10 hours)
- Consult with 2-3 approved lenders
- Get pre-approval with assistance programs
Months 2-3: Home Search
- Connect with experienced agent (Robert DeFalco Realty)
- Tour properties meeting program requirements
- Search Staten Island homes
- Make offer with pre-approval letter
- Execute purchase contract
Months 3-4: Closing
- Submit complete mortgage application
- Order inspection ($400-$600) and appraisal ($500-$800)
- Programs coordinate with lender
- Review Closing Disclosure
- Close and receive keys!
About the Author: Robert DeFalco is a licensed real estate broker with 30+ years helping first-time buyers achieve homeownership in Staten Island and NYC. He has guided over 2,000 first-time buyers through accessing down payment assistance.
Credentials: Licensed Real Estate Broker (NY), NAR Member, CRS, GRI, First-Time Homebuyer Specialist
This guide was updated October 2025. Program details change periodically. Consult current documentation and approved lenders for up-to-date information.