Saving for a down payment is one of the biggest obstacles to buying a home. Many buyers qualify for a mortgage but struggle to cover upfront costs like down payment and closing fees.
The National Homebuyers Fund (NHF) is a nonprofit organization that partners with participating lenders to provide structured down payment and closing cost assistance in many states.
This guide explains how NHF works, who may qualify, and what experienced buyers consider before using this type of assistance.
What Is the National Homebuyers Fund? The National Homebuyers Fund (NHF) is a nonprofit down payment assistance program that helps eligible homebuyers cover part of their down payment and closing costs.
In many participating areas, NHF may provide assistance of up to 5% of the loan amount, depending on lender participation and local program structure.
NHF assistance must be combined with an eligible first mortgage (such as FHA, VA, USDA, or conventional financing).
National Homebuyers Fund at a Glance Type: Nonprofit down payment assistance program Assistance: Up to 5% of loan amount (eligible areas) Structure: Grant or forgivable second loan Repayment: Grants require no repayment; forgivable loans require occupancy compliance Availability: Many U.S. states (through participating lenders) Buyer Type: First-time and repeat buyers (program dependent) How the NHF Program Works NHF assistance is layered on top of your primary mortgage.
It is typically structured as either:
Grant No repayment required Must meet program guidelines Forgivable Second Loan 0% interest Forgiven after a defined period (often several years) Requires continued occupancy The funds can be used toward:
Down payment Closing costs Prepaid expenses Borrowers must still qualify for the base mortgage.
Who Qualifies for NHF? Eligibility varies by state and lender, but common factors include:
Credit score typically around 640+ (program dependent) Debt-to-income ratio within lender guidelines Income limits based on local area median income Primary residence only Completion of a homebuyer education course Use of a participating NHF-approved lender Because requirements vary, qualification must be reviewed alongside the underlying mortgage program.
Does NHF Lower Your Mortgage Payment? Not directly.
NHF reduces upfront cash required at closing. Your monthly payment depends on:
Interest rate Loan type (FHA, VA, conventional, etc.) Mortgage insurance structure Total loan amount In some cases, assistance programs may have different pricing structures than standard financing, so a full comparison is important.
→ Read more: What Are the Different Types of Mortgages in the U.S.?
When Does NHF Make Financial Sense? NHF may make sense if:
You qualify for a mortgage but lack upfront savings You plan to stay in the home beyond the forgiveness period The long-term loan structure remains competitive It may be less beneficial if:
You plan to sell quickly You qualify for better pricing without assistance The adjusted rate structure offsets upfront savings A side-by-side cost review is essential.
Why Comparing Lenders Matters Because NHF must be combined with a first mortgage, lender selection can affect:
Rate structure Mortgage insurance costs Long-term affordability Down payment assistance is only one part of the total cost equation.
→ Read more: What Is the Difference Between Lender and Broker?
Why Choose Loan Factory At Loan Factory, we help buyers compare structured assistance options alongside standard mortgage programs.
Why Homebuyers Choose Loan Factory Best Price Guarantee – If Loan Factory cannot beat a competitor’s official offer, you receive $1,000 (Terms & Conditions apply ) Zero application or junk fees Transparent comparison across 242+ wholesale lenders AI-powered MOSO platform for real-time pricing Local loan advisors focused on clarity—not pressure Trusted guidance led by Thuan Nguyen (#1 Loan Officer in the U.S.) We help you determine whether NHF assistance truly improves your affordability.
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Based on real-world down payment assistance scenarios reviewed by Loan Factory’s lending team across multiple markets.
This content is for informational purposes only and not a commitment to lend. Program availability, rates, and eligibility depend on credit, income, property, underwriting, and participating lender guidelines.
FAQ: National Homebuyers Fund 
