Down Payment Assistance in Utah: A St. George Buyer's Guide
Hi, I'm Alex Hernandez, a mortgage loan officer with Guild Mortgage in St. George, Utah. If there's one thing that keeps people renting longer than they want to, it's the down payment. A lot of buyers I talk with in Washington County assume they need 20% saved before they can even start looking. The good news is that most loan programs don't require anywhere near that, and Utah has down payment assistance options that can help cover part of what you bring to closing. In this guide I'll walk through how down payment assistance works in Utah, the state programs worth knowing about, and how to figure out whether it makes sense for you.
What Is Down Payment Assistance?
Down payment assistance, often shortened to DPA, is money from a housing agency, a government program, or another approved source that helps you cover your down payment, your closing costs, or both. It isn't usually free cash. In Utah, the most common forms are:
- A repayable second mortgage. You take out a smaller second loan alongside your main mortgage and make a monthly payment on it.
- A deferred second mortgage. You don't make monthly payments, but the balance is due when you sell, refinance, or pay off the first mortgage.
- A 0% program loan. No interest and no monthly payment, repaid later under the program's rules.
Each type has trade-offs. A repayable second adds to your monthly payment. A deferred second keeps your payment lower now but reduces the equity you walk away with later. Neither one is right or wrong. It depends on your budget and your plans.
How Much Do You Actually Need for a Down Payment?
Before chasing assistance, it helps to know your real starting point. FHA loans allow as little as 3.5% down for borrowers with a qualifying credit score, and some conventional programs allow as little as 3% down for eligible buyers. VA and USDA loans can allow zero down for those who qualify. I break down the differences in my post on FHA vs conventional loans in Utah, and I cover how credit affects your options in what credit score you need to buy a house in Utah.
Don't forget closing costs. Those are separate from your down payment and often catch first-time buyers off guard. My Utah closing costs guide explains what to expect, and DPA can often be used for these costs too.
Utah Housing Corporation Programs
Utah Housing Corporation (UHC) is the state's housing finance agency, and it runs the best-known down payment assistance programs in Utah. You don't apply with UHC directly. You work with a Utah Housing participating lender, who qualifies you and handles the process.
FirstHome
FirstHome is UHC's program for first-time homebuyers. According to UHC's Selling Supplement, FirstHome is an FHA-insured or VA-guaranteed loan for first-time buyers with a minimum credit score of 660 purchasing a single-family residence in Utah. It can be paired with a Traditional DPA Second of up to 6% of the first loan amount, or a Deferred DPA Second of up to 3.5% of the first loan amount, subject to program rules and caps.
FirstHome also has income limits and purchase price limits that vary by county and household size. Rather than quote numbers that change, I'd point you to UHC's official income and purchase price limits, where you can look up Washington County, Iron County, and the rest of the state.
Options for repeat buyers
Owned a home before? You may still have options. UHC announced in January 2023 that its FHA/VA Mortgage program replaced the HomeAgain and Score loan programs. UHC's programs, including its FHA/VA Mortgage and HFA Advantage conventional loan, can be available to previous homeowners as well as first-time buyers, each with its own credit, income, and property rules. Program availability changes, so it's worth checking current guidelines with a lender before you plan around any one option.
New construction: the First-Time Homebuyer Assistance Program
If you're looking at a brand-new home, this one is worth knowing about. Utah's Legislature created the First-Time Homebuyer Assistance Program through Senate Bill 240 in 2023, and UHC administers it. Under Utah Code 63H-8-502, a first-time buyer can receive up to $20,000 in program funds for a qualifying home, and the funds can go toward the down payment, closing costs, a permanent interest rate buydown, or a combination.
A few details matter here:
- The home must be newly constructed, or newly built but not yet lived in.
- UHC lists a maximum purchase price of $450,000 for the program.
- According to UHC's program FAQ, the assistance is a 0% interest loan with no monthly payment, and it can be combined with UHC's DPA second mortgage.
- You must qualify for a Utah Housing mortgage through a participating lender, and funds are available only until they run out.
With all the new construction going up around St. George, Washington, Hurricane, and Cedar City, this can be a real help for buyers who find a qualifying home under the price limit.
Other Ways to Cover Your Down Payment
State programs aren't the only route. Here are a few other sources I see buyers use:
Gift funds
Most loan programs allow a down payment gift from a family member, as long as it's documented properly. That usually means a signed gift letter and a paper trail showing where the money came from. Talk to your lender before the money moves so it's handled the right way.
Seller concessions
In some deals, the seller agrees to pay part of your closing costs. Each program limits how much the seller can contribute. For conventional loans, Fannie Mae sets interested party contribution limits that depend on your down payment and occupancy. Seller credits generally help with closing costs rather than the down payment itself, but freeing up that cash can make a big difference.
Your own savings and retirement accounts
Some buyers use savings, a 401(k) loan, or other assets. Every source needs to be documented, and pulling from retirement accounts has its own pros and cons, so it's worth talking through with a tax professional too.
Is Down Payment Assistance Right for You?
DPA can get you into a home sooner, but it's not automatically the best choice. Here's how I'd think about it:
- Monthly payment. A repayable second adds a payment. Make sure the total fits your budget, not just the lender's maximum. My post on how much house you can afford in Utah can help.
- Rate and costs. Agency programs may carry different rates or fees than a standard loan. Compare the full picture.
- Your timeline. If you might sell or refinance in a few years, a deferred balance comes due sooner than you might expect.
- Price limits. Some programs cap the purchase price, which can narrow your search in higher-priced neighborhoods.
Sometimes waiting six months to save a little more is the better move. Other times, DPA is what turns "someday" into "this year." The only way to know is to run your real numbers side by side.
How to Get Started
The first step is getting preapproved, not just prequalified. A preapproval means a lender has actually reviewed your credit, income, and assets, which is also when we can see which assistance programs you might fit. If you're not sure of the difference, read prequalified vs preapproved. Self-employed? Check out my post for self-employed buyers first, since documentation works a little differently.
Some programs, like the new construction assistance, require reservation through a participating lender, and others recommend or require a homebuyer education course before closing. Starting early gives you time to check every box.
Frequently Asked Questions
Do I have to be a first-time buyer to get down payment assistance in Utah?
Not always. UHC's FirstHome and the new construction program are for first-time buyers, but UHC also offers programs that may be available to previous homeowners. Each has its own rules.
Do I have to pay down payment assistance back?
Usually, yes. Most Utah DPA comes as a second mortgage or a 0% program loan. Some require monthly payments and others are deferred until you sell, refinance, or pay off the first mortgage.
What credit score do I need for Utah Housing's FirstHome?
UHC's Selling Supplement lists a 660 minimum credit score for FirstHome. You still need to qualify on income, debt, and the property.
Can I use down payment assistance on a new build in St. George?
Possibly. The First-Time Homebuyer Assistance Program is designed for new construction and lists a $450,000 maximum purchase price. Funds are limited and available only while they last.
Down payment assistance has helped a lot of Utah buyers get into a home sooner than they thought they could. If you'd like to learn with other local buyers, join our free community, the Utah Homebuyer Club, and when you're ready, get approved and start your home buying journey so we can see which options fit your situation.
Equal Housing Opportunity. Alex Hernandez, NMLS #1605167. This article is for general educational purposes only and is not a commitment to lend or an offer of credit. All loans are subject to credit approval, underwriting, and property eligibility. Down payment assistance programs are offered by third parties, have their own eligibility requirements, and may change or end without notice. Contact me to review the options available for your situation.