First-Time Buyers · August 15, 2026 · 8 min read
I was sitting in my Bel Air office last Tuesday when a pre-approved buyer called me, absolutely crushed. She'd found a house in Baltimore County, made an offer, gone under contract—and then her lender called three weeks into the process to say her MMP loan was dead in the water.
The problem? She'd lived in Virginia for the past eighteen months.
Nobody told her that Maryland Mortgage Program assistance has a residency requirement buried in the eligibility rules. Not a credit score thing. Not a debt ratio issue. Just a simple fact: if you haven't lived or worked in Maryland for the past twelve consecutive months, you don't qualify for the down payment and settlement expense loans that make MMP so attractive.
Her agent (not me, for the record) hadn't asked. Her lender didn't catch it in the initial pre-approval. And now she was scrambling to find conventional financing with a much bigger down payment, trying to keep the contract alive.
So let's talk about what actually matters when you're chasing down payment assistance in Maryland, DC, Pennsylvania, and Delaware. Not the glossy stuff. The fine print that shows up at the worst possible time.
Maryland's flagship program—offered through the Maryland Department of Housing and Community Development—is genuinely good. A first mortgage at competitive rates, plus a second silent loan (up to $17,500 in many counties, more in targeted areas) to cover your down payment and closing costs. That second loan? Zero percent interest, deferred until you sell, refinance, or pay off the first mortgage.
It's a gift for first-time buyers scraping together cash in a market where even starter homes in Harford County or Anne Arundel County are pushing $350,000.
But here's what trips people up.
You must have lived or worked in Maryland for twelve consecutive months before closing. Not eleven months and three weeks. Twelve full months.
If you just moved here for a job? You wait. If you're commuting into DC from Virginia and want to buy in Prince George's County? You might not qualify yet. The clock matters.
Maryland defines "first-time buyer" as someone who hasn't owned a principal residence in the past three years. So if you sold a house in 2024, you're eligible again in 2027. Divorce, foreclosure, short sale—none of that disqualifies you, as long as three years have passed.
That's more generous than most people expect, and it opens the door for folks who assume they're out of the running.
This isn't a program for everyone. If you're buying in Baltimore City, the 2026 income limit for a household of one or two is around $128,700. In some lower-cost counties, it drops closer to $108,000. Larger households get higher caps.
Check your county before you get excited. A household pulling $140,000 in Montgomery County won't qualify, even if they're otherwise perfect candidates.
You can find current limits and participating lenders on the Maryland Department of Housing and Community Development website. Don't guess. Look it up.
Washington, DC's Home Purchase Assistance Program (HPAP) is more generous in dollar terms and more restrictive in practice.
You can get up to $202,000 in down payment and closing cost help. Yes, you read that right. It's an interest-free loan, due when you sell or no longer occupy the home as your primary residence.
But HPAP has income caps that knock out a lot of buyers (around $109,200 for a two-person household in 2026), and you're required to take an eight-hour homebuyer education course before you even apply. The program prioritizes lower-income households and District residents. If you work in DC but live in Maryland, you're not eligible.
I've worked with clients who qualified and used HPAP to buy a condo in Northeast DC that would've been financially impossible otherwise. It works. But it's not quick, and it's not flexible. Start the process early—like, months before you want to make an offer.
If you're looking at homes for sale in York County or Lancaster County, the Pennsylvania Housing Finance Agency runs several programs worth your time.
The Keystone Home Loan is the baseline: a standard 30-year fixed mortgage with down payment and closing cost assistance loans tacked on (usually $6,000 to $10,000, depending on the program tier). You don't need to be a first-time buyer for the base loan, though the richest assistance options do require it.
PHFA also designates certain ZIP codes as "targeted areas" where the income limits are higher and the assistance is more generous. Some rural parts of York County qualify. Check the map on PHFA's website before you write off a property because you think you make too much money.
One thing I appreciate about Pennsylvania's programs: the lenders who participate tend to know what they're doing. The residency and eligibility questions get caught early. It's a smoother process than I've seen in some Maryland transactions, honestly.
Delaware is often overlooked, but the Delaware State Housing Authority offers strong first-time buyer programs if you're considering New Castle County (Wilmington, Newark, and the communities in between).
Their Preferred Plus program offers down payment and closing cost assistance up to six percent of the loan amount, which can be substantial on a $300,000 home. Income limits are in the $130,000 range for a two-person household, a bit more flexible than Maryland in some cases.
Delaware also waives the first-time buyer requirement if you're purchasing in a targeted area. Worth exploring if you've owned before but want assistance now.
Let's be practical. We're in August 2026, and as I wrote earlier this week, inventory across the Northeast is painfully tight. Buyers outnumber sellers. Homes that are priced right go fast.
If you're using down payment assistance, you need to do three things before you even look at a house:
Get pre-approved with a lender who actually handles these programs. Not all lenders participate in MMP or HPAP. Ask explicitly. If they say "we can figure it out later," find a different lender.
Budget time. Assistance loans add paperwork. They add underwriting steps. They can add two weeks to your closing timeline. Sellers notice. In a competitive market, that can cost you the house. If you're looking at homes in Harford County or Baltimore County and you're competing against a conventional buyer with a 30-day close, you'd better have a really compelling offer otherwise.
Know your backup plan. What happens if the assistance doesn't come through? Can you close with a conventional loan and a smaller down payment? Can family help? Don't put all your eggs in one underwriting basket.
I've seen buyers lose great properties because they assumed MMP was a done deal and didn't have a Plan B when a documentation hiccup killed the assistance loan a week before closing.
Story one: I worked with a teacher in Harford County last spring—first-time buyer, modest income, qualified for MMP without a hitch. The $15,000 assistance loan let her buy a townhome in Edgewood she could actually afford. She's been there four months and loves it. The program worked exactly as advertised.
Story two: A couple relocating from Pennsylvania for work in Baltimore. Great credit, solid income, excited about the Baltimore City market. They'd been in Maryland for eleven months when they applied for MMP. Lender said no. They waited six weeks, reapplied, and bought a rowhouse in Fells Point in July. Annoying? Yes. But they knew the rule and planned accordingly.
The difference? One had an agent and lender who knew the requirements cold. The other learned the hard way.
Start with the primary source documents. Don't rely on a blog post (even this one) or a Facebook summary. Go to Maryland DHCD, DC DHCD, PHFA, or DSHA and read the current program guidelines. They change. Income limits adjust annually.
Talk to a lender who closes these loans every month. Ask how many MMP or HPAP loans they've done this year. If the answer is "a few," keep looking.
And talk to a Realtor who works in your target market regularly. I cover a lot of ground—Cecil, Harford, Baltimore County, Baltimore City, Anne Arundel, Howard, Montgomery, Charles, and Prince George's in Maryland, plus DC, York and Lancaster in Pennsylvania, and New Castle County in Delaware—and the local variations matter. What works in Baltimore City doesn't always work in rural Cecil County. The lending landscape is different. The competition is different.
If you want to see what's actually available right now, browse my current listings or reach out directly and we'll talk through what makes sense for your situation.
Down payment assistance is real, and it works. Thousands of Maryland, DC, Pennsylvania, and Delaware buyers use these programs every year to buy homes they couldn't otherwise afford.
But the eligibility rules are not suggestions. They're requirements, and they're enforced at the least convenient moment if you didn't check them up front.
My buyer from last Tuesday? She ended up getting a conventional loan with help from family and closed on time. The house in Baltimore County is hers. But it was a stressful three weeks that didn't need to happen.
Do the homework early. Ask the boring questions. Read the eligibility checklist twice. It's not exciting, but it's a hell of a lot better than losing your dream house because nobody mentioned the twelve-month rule.
That's the unglamorous truth from twenty-plus years in education and a few years in real estate: the people who succeed are the ones who read the syllabus.
Katrina Kirton Sherrod, REALTOR® · Samson Properties · Licensed in MD, DC, PA & DE · 443-616-9770 · Katrina@kkstherealtor.com
“Buyers decide in the first eight seconds of seeing a home if they are interested. Get out of the car, walk in the door — sold.” — Barbara Corcoran