Buying your first home in Connecticut can feel overwhelming. Between saving for a down payment, understanding mortgage rates, and figuring out closing costs, it's easy to wonder if you'll ever get there.

Here's the good news: Connecticut offers several programs designed specifically to help first-time buyers like you make homeownership a reality. And in 2026, there's even a brand-new tax savings program that just went into effect.

Let's break down what's available, how it works, and how you can take advantage of these resources.

What Counts as a First-Time Buyer?

Before we dive into the programs, let's clear up a common question: do you actually have to be buying your first home to qualify?

Not necessarily.

According to the Connecticut Housing Finance Authority (CHFA), you're considered a first-time buyer if you haven't owned a home in the past three years.[1] So even if you owned property years ago, you may still qualify.

There's also an exception: if you're buying in a targeted area of Connecticut, you might qualify for certain programs even if you've owned a home more recently.[1] These targeted areas are typically communities where the state wants to encourage homeownership and development.

Connecticut's Main Mortgage Programs

The Connecticut Housing Finance Authority runs the primary mortgage programs for first-time buyers in the state. These aren't just helpful: they can actually save you real money every month.

HFA Advantage and HFA Preferred

These programs offer lower mortgage insurance premiums compared to conventional loans.[1] That means your monthly payment is reduced, which can make a big difference when you're working within a tight budget.

Lower mortgage insurance isn't flashy, but it adds up. Over the life of your loan, you could save thousands of dollars just by using one of these programs instead of a traditional mortgage.

Homebuyer Mortgage Program

This one's designed for buyers who can handle the monthly mortgage payment but struggle with the upfront costs: down payment and closing costs.[1]

The program offers below-market interest rates, which lowers your monthly payment. Plus, it gives you access to down payment assistance programs that can cover a big chunk of those initial expenses.

Both programs have income and purchase price limits that vary by county and household size, so you'll want to check CHFA's website to see what applies to your situation.[1]

Down Payment Assistance That Actually Helps

Let's be honest: for most first-time buyers, the down payment is the biggest hurdle. Even if you can afford a monthly mortgage, coming up with $20,000 or $30,000 upfront? That's tough.

Connecticut has two main down payment assistance programs that can help.

Time To Own Forgivable Loan

This is a 0% interest loan with no monthly payments.[1][3] It can cover up to 20% of your down payment and up to 5% of your closing costs.

Here's what makes it really attractive: the loan is forgivable.

Every year you stay in the home, 10% of the loan is forgiven. After 10 years, the entire loan is wiped out: you owe nothing.[1]

If you sell or refinance before those 10 years are up, you'll need to repay whatever balance remains. But if you're planning to stay put, this is essentially free money to help you buy your home.

The loan caps depend on where you're buying:[1]

• Up to $50,000 for homes in High or Very High Opportunity Areas

• Up to $25,000 for homes in other areas

You can even combine Time To Own with other CHFA down payment programs, which gives you even more flexibility.[1]

One catch: you need to have been a Connecticut resident for at least three years to qualify for Time To Own.[1]

Down Payment Assistance Program (DAP)

This is another option through Connecticut Housing that works alongside Time To Own.[1] It provides additional funds to reduce your upfront costs, though the specific amounts and terms vary based on your situation.

The New 2026 Tax Savings Program

Here's something brand new: Connecticut just launched a First-Time Home Buyer Savings Program that started January 1, 2026.[2]

This program lets you save for a home purchase while getting a state tax deduction on your contributions.

Starting with your 2027 tax return, you can deduct:[2]

• Up to $2,500 per year if you file as a single filer

• Up to $5,000 per year if you file jointly

• Any interest earned on the account

• Qualified withdrawals used for eligible home buying costs

To qualify, your adjusted gross income (AGI) needs to be under $125,000 for single filers or $250,000 for joint filers.[2]

Here's what's cool: contributions you make in 2026 count toward your 2027 deductions, so you can start saving now and benefit next year.[2]

Even better, employers can contribute up to $2,500 per employee annually and receive a state tax credit for doing so.[2] If your employer offers this as a benefit, take advantage of it.

Local City Programs Worth Knowing About

Some Connecticut cities offer their own programs on top of the statewide options.

Stamford HOME Program

This program provides an interest-free loan of up to $20,000 for down payment and closing costs.[1] It's administered by Housing Development Fund, Inc., and is available to buyers with household income not exceeding 65% of the Area Median Income. There's a $2,000 fee to participate.[1]

New Haven Program

New Haven offers an interest-free loan covering up to 6% of the purchase price, maxing out at $10,000.[1] The loan is forgiven at 20% per year, which means after five years, it's completely forgiven.

If you're looking to buy in New Haven, Stamford, or other cities with these programs, ask your real estate agent about local options.

What You Need to Qualify

All of these programs have a few common requirements:[1][4]

• You must currently live in Connecticut (Time To Own requires three years of residency)

• You need to complete a free homebuyer education program through CHFA

• You can't own any other property at the time of closing

• If you're not a first-time buyer, you need to be purchasing in a targeted area

The homebuyer education requirement might sound like a hassle, but it's actually helpful. You'll learn about budgeting, understanding mortgages, maintaining your home, and avoiding common pitfalls. Plus, it's free.

How to Get Started

If you're serious about buying your first home in Connecticut, here's your game plan:

1. Check your eligibility. Visit chfa.org and use their resource map to see the purchase price and income limits for your county.[1]

2. Complete the homebuyer education course. CHFA offers this for free, and it's required for most programs.[1][4]

3. Talk to a lender who works with CHFA programs. Not all lenders participate, so make sure you're working with someone who knows these programs inside and out.

4. Work with a local real estate agent. Someone who knows the Connecticut market can help you find homes in your budget and guide you through the process.

Call me at 860-985-4363 or visit melindatherealtor.com for a free consultation. Never too busy for you to be my #1 client.

FAQ

Do I have to be buying my first home ever to qualify?

No. You're considered a first-time buyer if you haven't owned a home in the past three years. Some programs also allow non-first-time buyers if they're purchasing in targeted areas.[1]

Can I use multiple assistance programs at once?

Yes. You can combine the Time To Own forgivable loan with other CHFA down payment programs, which can significantly reduce your upfront costs.[1]

What happens if I sell my home before the Time To Own loan is forgiven?

You'll need to repay the remaining balance. The loan is forgiven at 10% per year, so if you sell after five years, you'd owe 50% of the original loan amount.[1]

Are there income limits for these programs?

Yes. Income and purchase price limits vary by county and household size. You can check the specific limits for your area at chfa.org.[1]

When can I start saving in the new tax savings program?

You can start contributing to a First-Time Home Buyer Savings Account right now in 2026. Those contributions will count toward your 2027 tax deductions.[2]

Do I need perfect credit to qualify?

Not necessarily. While good credit helps, CHFA programs are designed to be more flexible than conventional loans. Talk to a lender who works with these programs to understand your options.

Sources

1. Connecticut Housing Finance Authority (CHFA) – First-Time Buyer Programs
   https://www.chfa.org/homebuyers/
   Official eligibility rules, HFA loans, Time To Own, income and price limits.

2. CHFA – Time To Own Forgivable Loan Program
   https://www.chfa.org/timetoown/
   Authoritative details on forgiveness terms, amounts, residency rules, and usage.

3. Connecticut General Assembly – First-Time Homebuyer Savings Account Law
   https://www.cga.ct.gov/
   Statutory basis for the 2026 CT tax-deductible homebuyer savings program.

4. HUD – Connecticut Homeownership Assistance Programs
   https://www.hud.gov/states/connecticut/homeownership/buyingprgms
   Federal overview of CT assistance programs and CHFA partnership structure.

5. Housing Development Fund (HDF) – Stamford First-Time Buyer Assistance
   https://hdfconnects.org/
   Official local-program details for Stamford and similar municipal assistance.