Updated · Mike Certo, NMLS #260555
New Mexico Down Payment Assistance Programs (2026 Guide)
New Mexico's state down payment help runs through Housing New Mexico (the state's Mortgage Finance Authority, or MFA). The program names sound alike and half the internet describes them wrong. Here is what each one actually is, from the current MFA fact sheets.
What is the FirstDown program?
FirstDown is Housing New Mexico's main down payment assistance: $1,000 up to 4% of the home's sales price, usable for down payment and closing costs. It is a fixed-rate second mortgage with monthly payments, fully amortizing over 10, 15, or 30 years, with no prepayment penalty. It pairs with the FirstHome first mortgage and follows the same 620 credit floor and homebuyer-education requirement.
Worth repeating, because many websites get it wrong: FirstDown is not a grant and not a forgivable silent second. You make a monthly payment on it from month one. The forgivable program in New Mexico is HomeNow, and the two are different programs with different income limits.
What is FirstDown Plus?
FirstDown Plus is a fixed $10,000 third mortgage at 0% interest, repaid over 15 years at about $55.56 a month. It can only be layered on top of FirstDown or HomeNow, it can only be used toward the down payment (not closing costs), and combined MFA assistance cannot exceed $35,000. The program is funded by a $5.5 million New Mexico Housing Trust Fund allocation — funds are first-come, first-served, so availability can change inside a single home search.
What is HomeNow?
HomeNow is the forgivable one: a flat $7,000 at 0% interest with no monthly payment, forgiven entirely after 10 full years of living in the home as your primary residence. Sell, refinance, transfer title, or move out before the 10 years are up and the balance comes due. HomeNow is limited to households at or below 80% of area median income, first-time buyers, 620 minimum score. Like all MFA assistance, it is subject to available program funding.
Already owned a home? HomeForward
HomeForward is the path with no first-time-buyer requirement: a 620-minimum first mortgage for low-to-moderate income New Mexicans, with optional HomeForward DPA up to 3% of the sales price as a repayable second. HomeForward DPA covers down payment only — closing costs are eligible only when the first mortgage is USDA, VA, or HUD Section 184.
The $25,000 grant is gone (and has been since 2023)
Housing New Mexico's Down Payment Advantage program — the $25,000 grant — committed all of its funds on April 26, 2023 and stopped accepting reservations. It has no current fact sheet and is not part of the 2026 lineup. If a website or ad promises you a $25,000 New Mexico grant, it is running on three-year-old information. The current maximum through MFA layering is $35,000, and most of that is repayable assistance, not grant money.
2026 income and purchase-price limits
These limits take effect July 27, 2026 (FirstHome / FirstDown / FirstDown Plus; HomeNow uses separate, lower 80%-AMI limits):
| Area | Income limit (1-2 person) | Income limit (3+ person) | Purchase price limit |
|---|---|---|---|
| Albuquerque metro (Bernalillo + Sandoval) | $101,254 | $116,443 | $566,354 |
| Santa Fe area | $109,400 | $125,810 | $595,612 (Santa Fe County) |
| Doña Ana County (Las Cruces) | $93,240 | $108,780 | $566,354 |
| Los Alamos County | $170,900 | $196,535 | $724,361 |
| All other areas | $89,000 | $102,350 | $566,354 |
Targeted areas can carry higher limits. Source: Housing New Mexico income and purchase price limits.
What we originate (and what we don't)
Straight answer: Cornerstone First Mortgage is not a Housing New Mexico participating lender, so the MFA programs above close through MFA-approved lenders — you can find one on housingnm.org. What we originate directly for New Mexico buyers: Chenoa Fund (FHA-paired DPA with repayable and forgivable structures), Arrive Home (national DPA for low-to-moderate income buyers, including an ITIN path), and Essex Mortgage / NHF (multi-tier DPA for FHA, VA, USDA, and conventional) — plus FHA, VA, USDA, Conventional 97, and jumbo loans. One DPA program per transaction, whichever family it comes from. If the MFA math beats the national options for your file, we will tell you that straight.
What the layers look like on a $300,000 Albuquerque purchase
FHA first mortgage with 3.5% down needs $10,500 down plus roughly $6,000-$8,000 in closing costs. FirstDown can provide up to $12,000 (4% of $300,000) toward both. Layer FirstDown Plus and another $10,000 goes toward the down payment. Cash to close can drop to little more than prepaids and reserves — in exchange, you carry the FirstDown monthly payment plus $55.56 a month on FirstDown Plus. We run the exact numbers for your file before you commit to anything.
New Mexico down payment assistance FAQ
Do I have to pay back down payment assistance in New Mexico?
It depends on the program. FirstDown is a fixed-rate second mortgage with monthly, fully amortizing payments — it is repaid, not forgiven. FirstDown Plus is a $10,000 third mortgage at 0% interest, repaid at about $55.56 a month over 15 years. HomeNow is the exception: $7,000 at 0% with no monthly payment, forgiven after 10 full years of owner-occupancy.
Is the $25,000 down payment grant still available in New Mexico?
No. Housing New Mexico's Down Payment Advantage grant committed all of its funds on April 26, 2023 and stopped taking new reservations. Websites still advertising a $25,000 New Mexico grant in 2026 are more than three years out of date. Current MFA assistance comes through FirstDown, FirstDown Plus, HomeNow, and HomeForward DPA.
How much down payment assistance can I get in New Mexico?
Housing New Mexico caps combined MFA assistance at $35,000 per transaction. FirstDown provides $1,000 up to 4% of the sales price. FirstDown Plus adds a fixed $10,000 when layered with FirstDown or HomeNow. HomeNow provides $7,000 for buyers at or below 80% of area median income.
What credit score do I need for the MFA programs in New Mexico?
620 is the minimum credit score for Housing New Mexico's FirstHome, FirstDown, HomeNow, and HomeForward programs. Borrowers without a credit score may qualify using alternative credit history. Pre-purchase homebuyer education is also required.
What is the difference between FirstDown and HomeNow?
FirstDown provides up to 4% of the sales price as a fixed-rate second mortgage you repay monthly over 10, 15, or 30 years, with income limits that reach moderate incomes. HomeNow provides a flat $7,000 at 0% interest with no monthly payment, forgiven after 10 full years in the home — but only for households at or below 80% of area median income.
Can I get down payment help in New Mexico if I have owned a home before?
Yes. HomeForward is Housing New Mexico's program for buyers who are not first-time buyers. It pairs a first mortgage (620 minimum score) with optional HomeForward DPA of up to 3% of the sales price as a repayable second. The 4%-of-price FirstDown program is reserved for first-time buyers.
What are the income limits for New Mexico down payment assistance?
Effective July 27, 2026, FirstHome and FirstDown income limits are $101,254 (1-2 person households) and $116,443 (3+ persons) in the Albuquerque metro (Bernalillo and Sandoval counties), $109,400/$125,810 in the Santa Fe area, $93,240/$108,780 in Doña Ana County, $170,900/$196,535 in Los Alamos County, and $89,000/$102,350 everywhere else. HomeNow uses lower 80%-of-AMI limits.
Is there a purchase price limit for MFA programs?
Yes. Effective July 27, 2026: $724,361 in Los Alamos County, $595,612 in Santa Fe County, and $566,354 in all other New Mexico counties for FirstHome, FirstDown, and FirstDown Plus.
What is the MFA recapture tax and will I have to pay it?
Federal recapture tax applies to FirstHome loans only if all three happen: you sell at a net profit, within the first nine years, and your income has grown more than about 5% a year. Even then it is capped at the lesser of half your gain or 6.25% of the original loan. The vast majority of MFA borrowers never owe it. It is reported on IRS Form 8828.
Can Cornerstone First Mortgage do the MFA programs for me?
No. MFA programs close only through lenders approved by Housing New Mexico, and Cornerstone First Mortgage is not an MFA participating lender. We originate national down payment assistance (Chenoa Fund, Arrive Home, Essex/NHF) plus FHA, VA, USDA, conventional, and jumbo loans in New Mexico. We explain the MFA programs so you can compare the whole market honestly.
Can I combine MFA assistance with Chenoa, Arrive Home, or other national DPA?
No. You choose one down payment assistance path per transaction. Housing New Mexico's own layers combine with each other — FirstHome plus FirstDown, with FirstDown Plus on top — up to the $35,000 cap, but MFA assistance does not combine with a separate national DPA program on the same loan.
Talk through your New Mexico scenario
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