CHFA in Colorado Springs: Your Pathway to Homeownership (Explained)
If you live in Colorado Springs or nearby or maybe you're moving to Colorado Springs or Fountain, Monument, Peyton, Woodland Park, or further into El Paso County and you’ve been dreaming of owning a home, you’ve probably heard of CHFA. But what is CHFA? How does it help, and is it really something people in our region can tap into?
In this blog post, I’ll walk through exactly how CHFA works, local eligibility considerations, step-by-step guidance, and tips for leveraging CHFA in Colorado Springs. My goal is that by the time you're done reading, CHFA will feel like a tool you can actually use — not just a vague acronym.
Note: CHFA = Colorado Housing and Finance Authority.
What Is CHFA?
CHFA (Colorado Housing and Finance Authority) is a statewide authority created by the Colorado General Assembly in 1973. Its mission is to invest in affordable housing, homeownership, and community development across Colorado.
Key facts:
CHFA does not directly lend money to consumers. Instead, they partner with approved (“participating”) lenders who originate loans under CHFA’s guidelines.
Since its founding, CHFA has helped tens of thousands of Coloradans become homeowners.
CHFA also invests in affordable rental housing, housing preservation, and community development.
For someone in Colorado Springs, CHFA is one of your best bets for down payment support, favorable mortgage terms, and specialized programs designed to make homeownership accessible.
How CHFA Helps Homebuyers
CHFA offers a variety of tools and programs that can make homebuying easier. Here are the main ones:
1. First Mortgage Programs
These are standard mortgage loans (30-year fixed, etc.) but under CHFA’s eligibility rules. Some of the popular CHFA-backed mortgage programs include:
CHFA Preferred (for conventional borrowers)
CHFA SmartStep (works with FHA, VA, or USDA-backed loans)
CHFA FirstStep and FirstStep Plus
CHFA HomeAccess (especially for down payment/closing cost help)
These programs allow you to access good rates, and in many cases pair them with assistance.
2. Down Payment & Closing Cost Assistance
One of the biggest hurdles for homebuyers is the down payment and the fees at closing. CHFA helps here:
Down Payment Assistance Grant: Up to the lesser of $25,000 or 3% of the first mortgage amount. No repayment required.
Second Mortgage Loan (Deferred): Up to the lesser of $25,000 or 4% of your first mortgage amount. Repayment is deferred until certain triggers (refinance, sale, paying off the first mortgage, or when the home is no longer your primary residence).
HomeAccess Program: Especially for first-time homebuyers, CHFA offers a zero-interest second loan of up to $25,000 that can help with down payment, closing costs, and prepaids.
These tools are incredibly valuable as they can shrink your upfront cash needs and make buying a home sooner more feasible.
Eligibility & Requirements (with Colorado Context)
To benefit from CHFA, you must satisfy several criteria. The good news: many Colorado Springs buyers can. The tricky part is navigating the limits and rules — let’s break it down in local terms.
Credit Score & Debt-to-Income Ratio (DTI)
You typically need a credit score of at least 620.
Your debt-to-income (DTI) ratio can be as high as 50%, or up to 55% if your credit is stronger (e.g. 660+).
You must contribute at least $1,000 toward the purchase (your own funds or gifted).
Income Limits & Purchase Price Limits
These are areas where location matters. CHFA sets income and purchase price limits that vary by county and by program.
For example, CHFA’s income limits are published annually and differ depending on household size and the county.
The maximum loan limit for CHFA programs is the lower of $806,500 or the limit required by the specific loan type.
If you're in El Paso County (which includes Colorado Springs), you would want to check the CHFA published income and purchase price limits for that county for 2025. (At the time of writing, CHFA’s 2025 income and rent limits documents are available.
Homebuyer Education
CHFA requires you to complete a homebuyer education class (online or in person) before closing. It covers the mortgage process, budgeting, home maintenance, and more.
Property Requirements
The home must be your primary residence (you must live in it).
Eligible property types include single-family homes, condos, townhomes, manufactured homes (if on a permanent foundation).
The property must conform to CHFA’s guidelines (e.g. be a one-unit property in many cases).
Using CHFA in Colorado Springs & Nearby Areas
Now, how does this all play out for Colorado Springs, Fountain, Peyton, Monument, Woodland Park, and surrounding El Paso County?
Local Advantages
You can pair CHFA with local assistance programs. Many counties or municipalities (e.g. in El Paso County) have local down payment or closing cost assistance programs. When CHFA is combined with local grants, you may need even less of your own cash.
CHFA’s rules are statewide, but limits differ by county. So you’ll need to check the CHFA published income and price limits for El Paso County specifically.
Realtor & Lender Partnerships: As a Realtor in Colorado Springs, I can help refer clients to CHFA-participating lenders in this area. These lenders know how to structure deals under CHFA’s rules so you maximize benefits.
Sample Scenario: Buyer in Colorado Springs
Let’s say someone in Colorado Springs is buying a 3-bed, 2-bath single-family home priced at $400,000. They qualify under CHFA’s income limit for El Paso County (assuming they are within the house-hold limit), have a 640 credit score, DTI under 50%, and can contribute $1,000.
They apply using CHFA Preferred or FirstStep (depending on their lender), and also access CHFA’s Down Payment Assistance Grant of, say, 3% of the mortgage (that’s up to $12,000, if allowed). They may also apply for local county or city funds. That helps reduce out-of-pocket down payment from, say, $12,000+ to just a few thousand or lower.
Step-by-Step: Getting Started with CHFA (Especially in CO Springs)
Check eligibility early
Before you get too deep into home shopping, check your credit, estimate your DTI, and compare your income against CHFA income limits for El Paso County.Complete homebuyer education
Do this early! CHFA requires it before closing. Register for a class (online or local nonprofit) and complete it ahead of time.Work with a CHFA-participating lender
Use a lender approved by CHFA in the Colorado Springs area. They will know how to package the loan properly. (I can help refer you one if needed.)Pick a CHFA first mortgage product
Decide (with your lender) whether CHFA Preferred, SmartStep, FirstStep, or other is best for you based on your credit, situation, and goals.Apply for down payment / closing cost assistance
Request CHFA’s grant or second loan (as applicable). Also apply to any county/city assistance programs to layer resources.Shop homes within your budget
Use your lender’s estimate of how much you can afford (including CHFA assistance) to guide your home search, particularly in El Paso County.Underwriting & closing
Your lender will underwrite the loan under CHFA rules, verify all eligibility, and finalize loan docs. The down payment assistance is packaged with the mortgage.Move in & maintain homeownership knowledge
After closing, live in the home, maintain payments, and follow all CHFA rules (especially for grants or deferred loans, which often require occupancy).
Common Questions & Myths
Q: Can CHFA be used in Colorado Springs / El Paso County?
Yes. CHFA is statewide. As long as your home is in a county supported by CHFA (which includes El Paso County) and you meet county-specific limits, you can use it.
Q: Do I have to pay back the down payment assistance?
If it's a grant, you do not repay it. If it's a deferred second loan, you will eventually repay it (upon sale, refinance, or payoff).
Q: What if my credit score is below 620?
You can work on improving it (e.g. paying down debt, correcting errors). Some CHFA programs may allow nontraditional credit histories, but 620 is a common minimum.
Q: Are there purchase price limits in CHFA?
Yes — CHFA sets purchase price caps depending on program and county, though some programs (like CHFA Preferred) may not have a strict purchase price cap (but still fall under the $806,500 maximum loan limit).
Q: Can CHFA be used for fixer-uppers or renovation loans?
Generally, CHFA is not designed for heavy renovation financing. It is more for standard home purchase with assistance. If you need rehab funds, you might look at FHA 203(k) or other renovation programs.
Q: What will my monthly payment be?
Your monthly payment on a house in Colorado Springs will vary depending on credit, interest rate, and other qualifications. You can play with the mortgage calculator to see what payment you're comfortable with by visiting the Mortgage Calculator page.
Still have questions? Book a free consultation at livingthesprings.com/contact