First-Time Homebuyer's Toolkit: Grants and Incentives in 2026

Many individuals and families aspire to become homeowners, but they face several challenges. These challenges often include not having enough money for a down payment, having a limited credit history, or lacking job stability. Additionally, rising home prices, which reached a nationwide average of $368,198 in April 2026,¹ can pose a significant obstacle. Despite these difficulties, there are programs available to assist first-time homebuyers.

Here’s a guide that explores grants and incentives available in 2026 and highlights how they can help individuals and families overcome barriers to homeownership.

State-Specific Down Payment Assistance (DPA) Programs

All 50 U.S. states offer down payment assistance (DPA) programs for first-time homebuyers.² These programs are provided by state agencies, local housing authorities and nonprofit organizations to support low- to moderate-income borrowers. The assistance is available in the form of either loans or grants, helping borrowers meet their lender's down payment requirements.

Every state has its own down payment assistance (DPA) program, with different eligibility criteria. For example, in Georgia, borrowers cannot have more than $20,000 in liquid assets, or 20% of the home's sale price, whichever amount is greater.³ However, most states' programs share some common features.

First, borrowers need to earn less than a certain percentage of the area's median income (AMI) and meet a minimum credit score requirement. Next, borrowers must get approved for a 30-year fixed-rate mortgage from an approved lender and complete a homebuyer education workshop or online course before closing. Lastly, the home's price cannot exceed a limit set by the county. Check your state's Housing Authority website for more information. You can also consult a real estate agent or loan officer.

Builder Incentives for Homebuyers

Many home builders are responding to housing affordability by offering various incentives to first-time homebuyers. Common incentives include mortgage rate buydowns, where the builder pays a lump sum upfront to lower the buyer's interest rate, and closing cost credits, which provide funds to cover expenses such as title insurance, loan fees and taxes.

Next, a number of home builders are improving their offers by lowering base prices, which reduces the total loan amount for buyers. In March 2026, 37% of builders reported price reductions.⁴ To further lower costs, builders are adding smaller homes, such as townhomes and condominiums, to their inventory. This strategy is designed to provide more affordable housing options in the market.

Complimentary design upgrades are another incentive offered by home builders. By offering credits for enhancements such as upgraded countertops and premium lighting, builders can help buyers save money and create a more personalized living space.

Historically, the prices of existing homes have generally been lower than those of newly constructed homes. However, recent data indicate a shift in this trend. According to the National Association of Realtors, the median sales price of a new home in March 2026 was $387,400, compared to $417,700 for an existing home.⁵

Government-Backed Home Loans

The three types of government-backed home loan programs are Federal Housing Administration (FHA) loans, Department of Veterans Affairs (VA) loans and U.S. Department of Agriculture (USDA) loans. These loans are insured or guaranteed by the federal government, which reduces the risk for lenders who offer them, such as Ameris Bank. As a result, lenders may approve individuals and families who might not qualify for a conventional mortgage.

FHA Loans

FHA loans are insured by the Federal Housing Administration, which is part of the U.S. Department of Housing and Urban Development (HUD). FHA loans allow down payments as low as 3.5% and have more flexible qualifying requirements than conventional home loans. Plus, the FHA permits home buyers to negotiate with home sellers to put up to 6% of the purchase price toward closing costs.

VA Loans

VA loans are backed by the Department of Veterans Affairs (VA) and are available to qualifying veterans, active-duty service members and eligible surviving spouses. The main benefits of VA loans include no down payment requirement, no need for private mortgage insurance (PMI) and more flexible credit and income standards. Plus, up to 100% financing of the appraised home value is available.

USDA Loans

USDA loans are supported by the United States Department of Agriculture (USDA) and help people with low to moderate incomes buy homes in rural areas. These loans have several benefits for buyers. A down payment isn't needed, the credit requirements are easier than those for traditional loans, and the interest rates are usually lower. And with a USDA loan, up to 100% of the home's price can be financed.

Conventional 97 Loan Program

The Conventional 97 loan program, backed by Fannie Mae and Freddie Mac, allows qualified first-time homebuyers to obtain a conventional home loan with a 3% down payment. The "97" refers to the percentage of the loan amount, known as the loan-to-value (LTV) ratio. Borrowers must meet the standard guidelines for conventional loans, including credit score and debt-to-income requirements. It is worth noting that mortgage insurance is required for a Conventional 97 loan.

Federal Home Loan Bank (FHLB) Programs

Federal Home Loan Bank (FHLB) programs, offered by member banks, provide homebuyer grants and assistance to eligible first-time homebuyers (or those who haven't owned a home in the past 3 years). The funds can be used to help cover down-payment costs, closing expenses, housing counseling, and certain home repairs. Two programs currently available are FHLB Grants and Assistance and FHLB Community Partners.

The FHLB Grants and Assistance program is designed for eligible first-time homebuyers who need extra financial support getting started. Grants are offered up to $15,000 per household.

FHLB Community Partners is available to individuals who serve our communities. These include veterans and active-duty military, or their surviving spouse; essential workers; law enforcement officers; educators; healthcare workers; firefighters; or any other first responders. Grants are offered up to $15,000 per household.

To qualify for either FHLB program, buyers must meet specific credit requirements and household income limits and use the funds for a primary residence purchase. Other rules and requirements may apply, so it's best to talk to a qualified lender for more information.

First-time homebuyer grants and incentives can make homeownership more affordable and attainable.

¹ https://www.zillow.com/home-values/102001/united-states/

² https://www.forbes.com/advisor/mortgages/down-payment-assistance-by-state/

³ https://georgia.gov/apply-georgia-dream-homeownership-program

⁴ https://www.nahb.org/news-and-economics/press-releases/2026/03/builder-sentiment-inches-higher-but-affordability-concerns-persist

⁵ https://www.nar.realtor/magazine/real-estate-news/economy/home-sales-barely-move-as-inventory-constraints-persist

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Ameris Bank does not endorse nor is affiliated with the companies listed in this article.