Virginia Housing (VHDA) First-Time Homebuyer Programs 2026: Grants and Income Limits
Virginia Housing does not lend directly. Its loans, grants and second mortgages come through approved lenders.
Short answer: Virginia Housing gives first-time buyers three ways to cover the down payment or closing costs. The Down Payment Assistance Grant pays 2 percent of the price with a Conventional Bond loan or 2.5 percent with an FHA Bond loan, and never has to be repaid. The Closing Cost Assistance Grant pays up to 2 percent with a VA or USDA Bond loan. The Plus Second Mortgage lends up to 5 percent, repaid over 30 years, and repeat buyers can use it too. In Northern Virginia the grant income limit is $148,000 for one or two people and $174,000 for three or more, and the price limit is $800,000.
By Ken Byrne, NMLS #187129 · ALCOVA Mortgage LLC, NMLS #40508 · Updated September 2026
Virginia Housing, the state’s housing finance agency and still widely known by its legal name, the Virginia Housing Development Authority (VHDA), runs the state’s main set of first-time buyer programs. The trouble is that the pieces only fit together in certain ways: each grant works with one kind of first mortgage, each has its own income limit, and some require you to be a first-time buyer while others do not. This guide sets out the 2026 rules from Virginia Housing’s own program guides, all revised in August 2026, and runs the numbers on a Northern Virginia home. To see which combination fits you, talk to the Ken Byrne Team.
Virginia Housing first-time homebuyer programs at a glance
Every Virginia Housing first mortgage is a 30 year fixed rate loan. The products come in two families. Bond loans are for first-time buyers and are the only ones that can carry a grant. Non-bond loans are open to first-time and repeat buyers, with higher income limits and no Virginia Housing price cap.
| Program | What it is | Minimum credit score | Who can use it |
|---|---|---|---|
| Conventional and Conventional Bond | First mortgage, 3% down, reduced mortgage insurance for incomes at or below 80% of area median | 640 | Bond: first-time buyers. Non-bond: anyone under the income limit |
| FHA and FHA Bond | First mortgage, 3.5% down | 620 | Same split |
| VA and VA Bond | First mortgage, no down payment for eligible veterans | 620 | Same split |
| USDA and USDA Bond | First mortgage, no down payment in eligible rural areas | 620 | Same split |
| Down Payment Assistance Grant | 2% (Conventional Bond) or 2.5% (FHA Bond) of the price, no repayment | Follows the first mortgage | First-time buyers |
| Closing Cost Assistance Grant | Up to 2% of the price with VA Bond or USDA Bond, no repayment | Follows the first mortgage | First-time buyers |
| Plus Second Mortgage | Up to 5% of the price, 30 year fixed, monthly payments | 620 (FHA) or 640 (conventional); 680 for the top tier | First-time and repeat buyers |
Virginia Housing program guidelines and procedures for each product, last revised August 2026; virginiahousing.com home loans page, checked September 25, 2026. Maximum debt to income ratio is 50 percent with an automated approval.
First-time buyer means you have not owned and lived in a home as your main residence in the past three years. That rule is waived if you buy in one of Virginia Housing’s targeted areas, called Areas of Economic Opportunity. Bond loans can also trigger a federal recapture tax. It applies only if you sell within nine years, at a gain, and your household income in the year you sell is above a federal limit that rises 5 percent a year. Even then it is capped at the lesser of half your gain or 6.25 percent of the original loan amount, and your lender must give you a recapture disclosure at application and at closing.
Virginia Housing Origination Guide, revised August 2026; bond program guides, Exhibit E.
The Down Payment Assistance Grant
This is the program most people mean when they say Virginia Housing grant. It is a true grant, not a forgivable loan, so there is nothing to repay and no lien on the home.
| Rule | 2026 requirement |
|---|---|
| Amount | 2% with a Conventional Bond loan; 2.5% with an FHA Bond loan, of the lower of price or appraised value |
| Your own money | At least 1% of the price, which can come from a gift |
| Income limit | The lower grant limit for your area (table below) |
| Price limit | $800,000 in Northern Virginia |
| First-time buyer | Required, unless the home is in a targeted area |
| Homebuyer education | Required for first-time buyers, before loan approval |
| Can combine with | Not with the Plus Second Mortgage or the Closing Cost Assistance Grant |
Virginia Housing Down Payment Assistance Grant program guidelines, last revised August 2026.
On an FHA Bond loan the grant covers most of the 3.5 percent down payment, and you bring the rest. On a $450,000 home, the grant is $11,250 and your 1 percent is $4,500. You still need closing costs, which a seller credit can cover. For grants and loans from counties and the state, such as the Fairfax County Down Payment Loan and Loudoun’s programs, see our full list of Virginia down payment assistance programs.
The Plus Second Mortgage
The Plus Second Mortgage is a loan, not a grant. It sits behind a Virginia Housing FHA or conventional first mortgage and is repaid with its own monthly payment over 30 years. In exchange it can cover the whole down payment, and at a 680 score some of your closing costs too.
| First mortgage | Credit score | Plus Second amount | Rate |
|---|---|---|---|
| FHA or FHA Bond | 620 to 679 | 3.5% of the price | First mortgage rate plus 0.25% |
| FHA or FHA Bond | 680 or higher | 5% of the price (3.5% down plus 1.5% toward closing costs) | First mortgage rate plus 0.25% |
| Conventional or Conventional Bond | 640 to 679 | 3% of the price | First mortgage rate plus 0.125% |
| Conventional or Conventional Bond | 680 or higher | 4.5% of the price (3% down plus 1.5% toward closing costs) | First mortgage rate plus 0.125% |
Virginia Housing Plus Second Mortgage program guidelines, last revised August 2026. The 1 percent borrower asset requirement was removed in November 2025.
Two things make the Plus Second different from the grant. It is available to repeat buyers on the non-bond loans, and since November 2025 Virginia Housing no longer requires any of your own money with it; you only need to meet the FHA or conventional asset rules, and you still pay any closing costs the second loan and seller credits do not cover. It is not forgiven, so the second payment is part of your budget for as long as you have the loan.
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Grant or Plus Second: the numbers on a $450,000 home
Here is an FHA purchase of a $450,000 townhouse three ways, at the same illustrative rate so the only differences are the assistance. Taxes and insurance are the same in each case and are left out.
| $450,000 home, FHA at 7.03% | FHA, your own down payment | FHA Bond + DPA Grant | FHA + Plus Second (680 score) |
|---|---|---|---|
| Down payment needed | $15,750 | $15,750 | $15,750 |
| Paid by Virginia Housing | $0 | $11,250 grant | $22,500 second loan |
| Cash from you for the down payment | $15,750 | $4,500 | $0 |
| Help toward closing costs | $0 | $0 | $6,750 |
| First mortgage principal and interest | $2,949 | $2,949 | $2,949 |
| FHA monthly mortgage insurance | $198 | $198 | $198 |
| Plus Second payment | None | None | $154 |
| Monthly total before taxes and insurance | $3,147 | $3,147 | $3,301 |
Calculated. First mortgage includes the 1.75 percent FHA upfront premium financed; annual premium 0.55 percent. Rate is Freddie Mac’s September 24, 2026 survey average, used for illustration only; Virginia Housing rates are set by product and quoted by lenders. Plus Second at 7.28 percent over 30 years.
The grant saves $11,250 of your cash and costs nothing each month. The Plus Second saves more cash, $22,500, but adds $154 a month for 30 years. If you qualify for the grant, it is usually the better deal. The Plus Second wins when your income is above the grant limit, you are a repeat buyer, or you have almost no savings. How FHA compares with a conventional loan on the same home is in our guide to FHA vs conventional loans.
The grant saves cash and costs nothing monthly; the Plus Second saves more cash but adds a second payment.
Virginia Housing (VHDA) income and sales price limits for 2026
Virginia Housing uses three sets of income limits. The grant limit is the lowest, the bond limit is in the middle, and the non-bond limit is the highest. These took effect for applications on or after August 1, 2026, and are the same figures as the previous year.
| Area | Grant limit, 1 or 2 people | Grant limit, 3 or more | Bond loan limit, 1 or 2 | Bond loan limit, 3 or more | Price limit |
|---|---|---|---|---|---|
| Northern Virginia | $148,000 | $174,000 | $186,000 | $217,000 | $800,000 |
| Culpeper | $98,000 | $115,000 | $123,000 | $144,000 | $675,000 |
| Norfolk, Virginia Beach, Newport News | $97,000 | $113,000 | $121,000 | $141,000 | $575,000 |
| Richmond | $96,000 | $110,000 | $120,000 | $138,000 | $550,000 |
| Charlottesville | $95,000 | $109,000 | $119,000 | $137,000 | $550,000 |
| All other areas of Virginia | $90,000 | $103,000 | $112,000 | $129,000 | $500,000 |
Virginia Housing income and sales price limits, effective August 1, 2026. Northern Virginia includes Alexandria, Arlington, Clarke, Fairfax city and county, Falls Church, Fauquier, Fredericksburg, Loudoun, Manassas, Manassas Park, Prince William, Spotsylvania and Stafford.
The non-bond loans, which first-time and repeat buyers can use, have an income limit of $245,000 in Northern Virginia and $175,000 elsewhere, for any household size, and no Virginia Housing price limit.
Which limit applies to you
Take a household of two in Loudoun County earning $160,000. That is above the $148,000 grant limit, so the grant is out. It is under the $186,000 bond limit and the $245,000 non-bond limit, so an FHA or conventional loan with the Plus Second is still available. A household of three at the same income is under the $174,000 grant limit and can use the grant. For the grants and bond loans, Virginia Housing counts the income of everyone who will live in the home, not only the people on the loan. For non-bond loans it counts the qualifying income of the borrowers. Your loan officer will confirm the figure with Virginia Housing’s household income worksheet.
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Veterans and rural buyers: the Closing Cost Assistance Grant
VA and USDA loans already need no down payment, so Virginia Housing’s help for those buyers goes toward closing costs instead. The Closing Cost Assistance Grant pays up to 2 percent of the price with a VA Bond or USDA Bond loan. It can pay closing costs, discount points, prepaid items and the VA funding fee or USDA guarantee fee, and it does not have to be repaid. On a $450,000 home that is up to $9,000.
It follows the same grant income limits and first-time buyer rule as the down payment grant. Whether you qualify for VA in the first place is covered in our guide to VA loan eligibility.
The grant rarely covers every cost at settlement, so plan for the rest. A line by line look at what buyers pay is in our guide to closing costs in Virginia.
Virginia Housing Closing Cost Assistance Grant program guidelines, August 2026.
How to qualify and apply
Virginia Housing does not take applications from buyers. You apply with a Virginia Housing approved lender, who checks your eligibility, reserves the grant or second mortgage with your rate lock, and submits the loan.
| Step | What to know |
|---|---|
| 1. Check your credit | 620 for FHA, VA and USDA; 640 for conventional; 680 for the larger Plus Second |
| 2. Take the homebuyer class | Free from Virginia Housing, in person or online and self paced (about 8 hours); required for first-time buyers; the certificate is good for 2 years |
| 3. Get pre-approved with an approved lender | The lender runs your income against the grant, bond and non-bond limits |
| 4. Find a home under the price limit | $800,000 in Northern Virginia for bond loans and grants |
| 5. Lock the rate and reserve the assistance | Grant funds follow the first mortgage rate lock |
Virginia Housing homebuyer education page and program guides, August 2026. HUD approved counseling, Fannie Mae Framework and Freddie Mac CreditSmart courses are also accepted; Fannie Mae HomeView is not.
What score you need across all loan types, and how to raise it, is in our credit score guide.
For the rest of the first-time buyer picture across the region, from saving to closing, see our first-time homebuyer guide for Virginia, DC and Maryland.
Loan options for every kind of buyer in the state, not only first-time buyers, are on our Virginia mortgage page.
Programs that are paused or closed in 2026
Several Virginia Housing programs that still show up in older articles are not available right now. The Mortgage Credit Certificate has been suspended since May 1, 2023. The Community Heroes Grant pilot closed on March 3, 2026. FirstHome Dream, for first-generation buyers, stopped taking reservations on June 30, 2026, with next year’s funding not yet set. The SPARC rate reduction program’s funding period closed on June 30, 2026 (buyers with existing reservations had to lock by July 31), and the next funding period opens in January 2027.
Virginia Housing Mortgage Credit Certificates page and lender announcements, checked September 25, 2026.
Frequently asked questions
How much is the Virginia Housing grant in 2026?
2 percent of the price with a Conventional Bond loan or 2.5 percent with an FHA Bond loan, based on the lower of price or appraised value. It does not have to be repaid.
Do I have to pay back the Virginia Housing Down Payment Assistance Grant?
No. It is a grant, not a loan. The Plus Second Mortgage is the Virginia Housing option that is repaid.
What are the Virginia Housing income limits for Northern Virginia?
For the grant, $148,000 for one or two people and $174,000 for three or more. For bond loans without a grant, $186,000 and $217,000. For non-bond loans, $245,000 for any household size.
What is the Virginia Housing sales price limit?
$800,000 in Northern Virginia for bond loans and grants, $550,000 in Richmond and $500,000 in most of the rest of the state. Non-bond loans have no Virginia Housing price limit.
What credit score do I need for Virginia Housing?
620 for FHA, VA and USDA loans and 640 for conventional loans. The larger Plus Second Mortgage amounts need 680.
Do I have to be a first-time buyer?
For the grants and bond loans, yes, meaning you have not owned your main home in the past three years, unless you buy in a targeted area. Non-bond loans and the Plus Second Mortgage are open to repeat buyers.
Can I use the grant and the Plus Second Mortgage together?
No. You choose one or the other.
Is the Virginia Housing Mortgage Credit Certificate available?
No. It has been suspended since May 1, 2023.
Is the Virginia Housing homebuyer class free?
Yes. It is free in person or online, required for first-time buyers, and the certificate is valid for two years.
Can I apply directly with Virginia Housing?
No. Virginia Housing works through approved lenders, who handle the application, the rate lock and the assistance reservation.
Next stepStart Your Pre-Approval
Start online, and Ken Byrne’s team will check the grant, the Plus Second and the income limits with you.
✓Free, no obligation✓Licensed in VA, MD, DC and WV✓Loan officer Ken Byrne, NMLS #187129
This article is general information, not financial or legal advice and not a commitment to lend or an offer of credit. Loan limits, program rules, premium schedules and rates change, and individual eligibility depends on a full review of your credit, income, assets and the property. Every figure here is an illustration, not a quote, built from published sources and a weekly survey average rather than underwriting decisions. Insurance and mortgage insurance amounts are planning estimates. Confirm anything you plan to act on with a licensed mortgage professional. Virginia Housing program terms are from its program guides last revised August 2026 and income and sales price limits effective August 1, 2026. Virginia Housing may change or suspend programs at any time, and assistance is subject to availability of funds.
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