Buying your first home in Pennsylvania comes with upfront costs that can feel overwhelming—down payments, closing fees, and out-of-pocket expenses add up quickly. That’s where the Keystone Advantage Assistance Loan from the Pennsylvania Housing Finance Agency (PHFA) can make all the difference.
If you’re searching for Keystone Advantage Assistance Loan, this guide explains exactly how it works, who qualifies, and why it’s one of the best resources for first-time homebuyers in Pennsylvania.
What Is the Keystone Advantage Assistance Loan?
The Keystone Advantage Assistance Loan is a second mortgage loan designed to help Pennsylvania buyers cover down payments and closing costs.
- Loan Amount: Up to $6,000, or 4% of the home’s purchase price (whichever is less)
- Interest Rate: 0% (no interest charged)
- Repayment: Spread over 10 years, making monthly payments affordable
- Use: Must be paired with a PHFA first mortgage (such as Keystone Home Loan, HFA Preferred™, FHA, VA, or USDA)
In other words, this program bridges the gap for buyers who can afford a monthly mortgage but struggle with upfront costs.
Who Qualifies for the Keystone Advantage Assistance Loan?
The Keystone Advantage Assistance Loan is managed by the Pennsylvania Housing Finance Agency (PHFA).
PHFA is a state agency created to help Pennsylvania residents buy affordable homes by offering low-interest mortgages and down payment assistance programs.
To qualify for Keystone Advantage, buyers need to meet certain requirements:
1. Must qualify for a PHFA first mortgage
This means your main home loan must be one of PHFA’s approved programs, such as:
- Keystone Home Loan (fixed-rate mortgage for first-time buyers)
- FHA Loan (backed by the Federal Housing Administration)
- VA Loan (for veterans, service members, and eligible spouses)
- USDA Loan (for eligible rural properties in Pennsylvania)
- HFA Preferred™ Loan (a low-PMI conventional option through PHFA)
Keystone Advantage is not a standalone loan—it works as an add-on to help with upfront costs when you’re already approved for a PHFA mortgage.
2. Minimum credit score of 660
3. Meet PHFA income and purchase price limits
Each county in Pennsylvania has specific limits based on household size and median income.
Example: In Allegheny County, the maximum household income might differ from Philadelphia County.
These limits ensure the program is focused on helping low- and moderate-income buyers.
4. The home must be your primary residence
You need to live in the home you’re purchasing—it cannot be a vacation home or investment property.
5. Limited liquid assets after closing
PHFA requires that borrowers do not have excessive cash savings after the purchase.
This ensures the assistance goes to families who genuinely need help covering upfront costs, not those who already have plenty of liquid funds.
Example: PHFA Income & Purchase Price Limits by County
County | Max Household Income (1–2 people) | Max Household Income (3+ people) | Max Purchase Price | Notes |
Allegheny County (Pittsburgh area) | ~$95,000 | ~$110,000 | ~$400,000 | Popular for first-time buyers; mix of FHA & Conventional through Keystone. |
Philadelphia County | ~$105,000 | ~$120,000 | ~$420,000 | Higher limits due to city housing costs; strong demand for FHA + down payment assistance. |
Lancaster County | ~$90,000 | ~$105,000 | ~$380,000 | More rural/suburban, USDA loans often used with Keystone. |
At Loan Factory, we automatically check your eligibility with PHFA guidelines—so you’ll know instantly if you qualify for Keystone Advantage.
→ Read more: Find First Time Home Buyer Loans in Pennsylvania
Key Benefits for First-Time Buyers
- Reduce Out-of-Pocket Costs: Covers part of your down payment and/or closing costs.
- Homeownership Becomes Accessible: Helps buyers who qualify on income but lack upfront cash.
- 0% Interest Loan: Every dollar you repay goes toward principal—no extra fees or interest.
- Works With Keystone & PHFA Programs: Can be combined with K-FIT forgivable loans or HOMEstead grants for even bigger savings.
Example: How Keystone Advantage Works
Home Price: $200,000
- FHA Down Payment (3.5%): $7,000
- Closing Costs: ~$6,000
- Total Due at Closing: ~$13,000
With Keystone Advantage:
- Borrow up to $6,000 toward down payment/closing costs
- Pay only ~$7,000 upfront instead of $13,000
- Repay the $6,000 over 10 years at 0% interest (~$50/month)
This makes homeownership possible sooner, without draining your savings.
Keystone Advantage vs. Other Assistance Programs
Feature | Keystone Advantage Loan | K-FIT Forgivable Loan | HOMEstead Assistance |
| Max Amount | $6,000 or 4% of purchase price | Up to 5% of purchase price | Up to $10,000 |
| Interest | 0% loan, repay over 10 years | Forgivable over 10 years | Forgivable over 5 years |
| Repayment | Yes, monthly payments | No (forgiven if you stay 10 years) | No (forgiven if you stay 5 years) |
| Availability | Statewide | Statewide | Limited counties |
Why Work With Loan Factory for Keystone Advantage
At Loan Factory, we help Pennsylvania buyers:
- Apply once and access all PHFA programs instantly
- Compare 240+ lenders side by side
- Use AI-powered applications for faster approvals
- Get guidance from local advisors who understand PHFA rules
- Pay no junk fees—just transparent costs
“We’ve helped thousands of first-time buyers in Pennsylvania unlock Keystone Advantage to reduce upfront costs and move into their first home sooner.” – Thuan Nguyen, CEO
If you’re ready to explore the Keystone Advantage Assistance Loan, Loan Factory makes it simple:
Check your eligibility today and see how much down payment and closing cost help you can receive.
FAQs – Keystone Advantage Assistance Loan
