City Lender I - with Down Payment Assistance (City of Columbia)

What is City Lender I - with Down Payment Assistance (City of Columbia)?

City Lender I - with Down Payment Assistance (City of Columbia) is a forgivable loan for homebuyers in Columbia, South Carolina, administered by City of Columbia Community Development Department.

• The City of Columbia City Lender I program helps income-eligible buyers purchase a single-family home within the City of Columbia city limits. Financing is structured 80/20: a partner bank holds an 80% first mortgage while the City holds a 20% second mortgage at 4% for 30 years (blended 4% rate, no PMI). The buyer puts only $500 down regardless of sales price. Eligible borrowers may also receive up to $18,500 in down payment/closing cost assistance as a forgivable third mortgage forgiven over 5 years of continuous residence. Maximum purchase price is $225,000.
• $500 down payment regardless of sales price.
• Up to $18,500 DPA as a forgivable third mortgage (forgiven over 5 years).
• City 20% second mortgage at 4% for 30 years.
• No private mortgage insurance.
• This is a federal program, so it is available beyond a single state or city.
• Funding comes from HOME / CDBG federal funds administered by the City of Columbia Community Development Department.

How much assistance does it provide?

City Lender I - with Down Payment Assistance (City of Columbia) offers up to $18,500 in assistance.

• The program asks buyers to contribute $500 down payment regardless of sales price.
• The program can be combined with City Lender I 80/20 first/second mortgage structure.
• Amounts are the program's published maximums, not an offer — City of Columbia Community Development Department determines any individual award.

Do you have to pay it back?

City Lender I - with Down Payment Assistance (City of Columbia) is forgiven after 5 years, so a buyer who stays that long does not repay it.

• Repayment is triggered by Sale, transfer, or loss of owner-occupancy before completing 5 years (forgivable third mortgage); City second mortgage repaid per its 30-year amortization or upon sale/transfer.
• The assistance is recorded in City assistance in second (20% City mortgage) and third (forgivable DPA) lien positions behind the partner bank first mortgage. position.
• Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

City Lender I - with Down Payment Assistance (City of Columbia) is open to buyers who will live in the home as their primary residence.

What are the income limits?

City Lender I - with Down Payment Assistance (City of Columbia) limits household income to 80% of the area median income, which varies by county and household size.

• Owner-occupied loans only. Max income by household size (City Lender I, rev. 5/11/2026, Columbia SC HMFA): 1 $51,750; 2 $59,150; 3 $66,550; 4 $73,900; 5 $79,850; 6 $85,750.
• The limit applies to total household income, not only the borrower’s.
• Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

What kind of home can it be used for?

City Lender I - with Down Payment Assistance (City of Columbia) caps the purchase price at $225,000.

• Eligible property types include Single Family.

Where does it apply?

City Lender I - with Down Payment Assistance (City of Columbia) is a federal program, so it is not limited to South Carolina.

• Targeted neighborhoods: Single-family homes within the City of Columbia city limits.

How do you apply?

Applications for City Lender I - with Down Payment Assistance (City of Columbia) go through City of Columbia Community Development Department, which publishes the current terms and the application steps on its own site.

1. 1

   Take a homebuyer education course

   Required by the program, through Homeownership training by an approved organization/agency/community college or bank-supervised self-study; HUD-certified credit counseling. City of Columbia and Columbia Housing Authority also provide counseling..

2. 2

   Contact City of Columbia Community Development Department to reserve funds

   Funds are reserved with the provider and are subject to availability.

3. 3

   Work with a lender who handles the program

   Hey Prescott is not a lender and does not accept applications; this page describes the program so a buyer can take it to a lender or housing counselor.