First-Time Home Buyer Programs in New Mexico 2026
New Mexico’s first-time buyer loans come from Housing New Mexico, the name the New Mexico Mortgage Finance Authority (MFA) operates under. FirstHome is its first mortgage for buyers who have not owned and lived in a home in the past three years, a rule waived in targeted census tracts. FirstDown adds a repayable second mortgage of up to 4% of the sales price.
Housing New Mexico’s down payment loans each attach to one of two first mortgages. FirstHome is for first-time buyers. HomeForward is for everyone, including people who owned a home last year. Which one you are sent to decides the income cap, the price cap, which down payment loans you can add, and whether you need a counseling certificate.
| Housing New Mexico loan | Who can use it | Add-on help | Counseling |
|---|---|---|---|
| FirstHome (first mortgage) | First-time buyers, or any buyer in a targeted census tract | FirstDown, then FirstDown Plus; or New Homes for New Mexico on an approved new starter home | Required for all homebuyers |
| HomeForward (first mortgage) | “Borrower does not have to be a first-time homebuyer” | HomeForward DPA; NewHome Rate Advantage on new construction; or New Homes for New Mexico for first-time buyers of an approved new starter home | Required for first-time buyers only |
FirstHome and New Mexico’s three-year test
The FirstHome fact sheet (Rev. 10/22/25) defines first-time buyers as people “who have not owned and occupied a home as their primary residence in the past three years.” It works with FHA, VA, USDA, HFA Advantage and HFA Preferred conventional loans. You must move in within 60 days of closing. The house can’t produce income, and business-use restrictions apply. FirstHome finances single-family homes only, and the fact sheet includes single or multi-section manufactured homes that meet FHA, VA, USDA, Fannie Mae, Freddie Mac or HUD Section 184 guidelines.
FirstHome is paid for with tax-exempt Mortgage Revenue Bonds, and FirstHome closing packages now include a “Notice of Potential Recapture Disclosure” that the borrower signs. Housing New Mexico’s lender memo tells buyers with recapture questions to see a tax professional, because agency staff can’t give tax advice.
Targeted census tracts change the rules
If the house sits in a targeted tract, Housing New Mexico waives the first-time requirement for FirstHome. It also raises the income and price limits and gives you “the lowest interest rate that was offered for the same loan type during the past 12 months.” A targeted tract is a neighborhood where at least 70% of households earn no more than 80% of area median income. The agency’s targeted-area page lists the tract numbers county by county and links the FFIEC address lookup. Your loan officer can run a specific address. These targeted limits apply only to FirstHome and FirstDown.
The limits that took effect July 27, 2026
A July 22, 2026 lender memo said new IRS and HUD figures would take effect for reservations on or after July 27, 2026. It added that “all county limits either increased or stayed the same.” Here are a few rows from the limits page. For FirstHome and FirstDown in the Albuquerque MSA (Bernalillo, Sandoval, Torrance, Valencia), gross household income can reach $101,254 for 1-2 people and $116,443 for 3 or more. The FirstHome purchase price cap is $724,361 in Los Alamos County, $595,612 in Santa Fe County and $566,354 everywhere else. In a targeted tract, the price cap is $692,211 statewide. Targeted-tract income can reach $120,480 (1-2 people) or $140,560 (3 or more) in the Albuquerque MSA, and $106,800 or $124,600 in other tracts.
FirstDown and FirstDown Plus are loans with monthly payments
FirstDown is “a fixed-rate second mortgage loan program.” It covers down payment and closing costs up to 4% of the sales price, and it must be paired with FirstHome. The fact sheet promises “Multiple repayment term options” and a “budget-friendly monthly payment,” so you repay it month by month.
FirstDown Plus is a third mortgage stacked on top: “a fixed $10,000 amortizing loan with a 0.00% interest rate, a 15-year term, and monthly principal payments of $55.56.” All $10,000 must go to the down payment. The fact sheet says plainly that “FirstDown Plus is a loan, not a grant.” It also says funds “are limited and available on a first-come, first-served basis,” and that combined Housing New Mexico DPA loans can’t exceed $35,000. For how these compare with other help in the state, see our New Mexico down payment assistance guide.
HomeNow: funds depleted
HomeNow is Housing New Mexico’s forgivable second mortgage for first-time buyers at or below 80% of area median income. It still appears on the mortgage programs page. However, lender memo 2025-16 (October 1, 2025) says its “funds have been depleted” and lets lenders move those borrowers to FirstDown, which keeps them eligible for FirstDown Plus. Housing New Mexico’s September 3, 2026 program brochure lists FirstHome, FirstDown, FirstDown Plus, HomeForward, HomeForward DPA, NewHome Rate Advantage and New Homes for New Mexico among its homeownership programs, and HomeNow isn’t there. Don’t plan a purchase around it.
HomeForward for repeat buyers, and help on new construction
HomeForward is a first mortgage open to first-time and repeat buyers. It works with FHA, VA, USDA, Fannie Mae HFA Preferred and HUD Section 184 loans (HomeForward program policy, July 20, 2026), has the same 620 credit floor, and has its own county limits. In Bernalillo County, for example, the purchase price cap is $629,283, and income can reach $150,600 for a household of 1-4 or $162,750 for 5 or more. HomeForward DPA is a fixed-rate, amortizing second mortgage of up to 3% of the sales price, with a 15-year or 10-year term under the July 20, 2026 program policy. It goes toward the down payment only; that policy allows it to cover closing costs only on USDA or VA loans (the October 2025 fact sheet also lists HUD Section 184, so confirm with your lender).
NewHome Rate Advantage opened to reservations on July 27, 2026. It gives a “permanent 1.00% interest rate buydown” on a 30-year fixed HomeForward loan, and the buydown doesn’t have to be repaid. It is only for newly built, site-built homes that no one has lived in, with a certificate of occupancy no more than 12 months old. Manufactured and modular homes are excluded. Housing New Mexico calls it “a pilot program with limited funding.”
New Homes for New Mexico is a separate down payment program for first-time buyers of newly built starter homes (up to 1,800 square feet on a lot of no more than 5,000 square feet) sold by builders that Housing New Mexico has approved. Its September 2026 FAQ describes a zero-interest, non-amortizing loan of $50,000, or $75,000 in Los Alamos, Santa Fe and Taos counties. The full balance comes due if you sell, refinance, rent out or transfer the home, or stop living in it. It works with FirstHome or HomeForward, but you can’t add any other Housing New Mexico down payment loan or NewHome Rate Advantage, and the targeted-tract waiver doesn’t apply. You don’t apply for it directly: the builder refers you to a participating lender.
Credit, counseling and lender rules at Housing New Mexico
- Credit: a 620 minimum score. FirstHome allows alternative credit “in certain cases” for buyers with no score at all.
- Counseling: FirstHome requires pre-purchase counseling for all homebuyers. You can do it through Housing New Mexico’s online program, eHome America, or a HUD-approved counseling agency. On HomeForward, only first-time buyers need it.
- Lender: each program is sold only through Housing New Mexico-approved participating lenders. You apply with the lender, and the lender reserves the loan with the agency.
- Tax credit: Housing New Mexico’s September 2026 brochure lists no mortgage credit certificate among its homebuyer programs.
One county program that stacks with Housing New Mexico loans
In Valencia County, Homewise runs a down payment program with the county. Homewise’s page advertises up to $30,000, plus $10,000 more on new construction, where the builder must put at least $10,000 toward the deal. The program is open to first-time buyers and current homeowners buying a primary residence in the county, with income up to 150% of area median. Sales must close by June 30, 2027. Homewise’s page doesn’t say whether the money is a grant or a loan, so ask for the terms in writing. An April 2, 2026 Housing New Mexico memo says Homewise confirmed the program can be combined with FirstHome or HomeForward plus FirstDown, FirstDown Plus or HomeForward DPA, and that you must qualify for both.
Useful New Mexico links
- Housing New Mexico participating lenders
- Closing costs in New Mexico
- Lenders active in New Mexico
- How much house you can afford and the payment calculator
- FHA requirements, VA loans, pre-approval
- New Mexico hub; neighbors: Arizona, Colorado, Texas
What New Mexico buyers ask
Does Housing New Mexico still offer a down payment grant?
No. Its Down Payment Advantage funds were fully committed in April 2023. Housing New Mexico said then that it did “not anticipate having funding sources” for another down payment grant program.
I owned a house in Las Cruces until 2024. Can I use FirstHome?
Probably only if the new home is in a targeted census tract, because 2024 is inside the three-year window. Housing New Mexico’s New Homes FAQ also refers to a first-time buyer waiver for honorably discharged veterans, which its FirstHome policy doesn’t spell out, so a veteran should ask a participating lender. Otherwise HomeForward and HomeForward DPA are the Housing New Mexico route.
How much does FirstDown Plus cost me each month?
$55.56 in principal, for 15 years, at 0.00% interest. The balance is due if you sell, refinance or transfer the home first.
Can I get HomeNow’s forgivable money in 2026?
Not on current information. The agency’s October 2025 memo says HomeNow funds were depleted, and the 2026 brochure leaves it out.
Does a new-build home get anything extra?
Possibly two things, and you can’t combine them. First-time buyers of an eligible starter home from an approved builder may get a New Homes for New Mexico loan of $50,000 ($75,000 in Los Alamos, Santa Fe and Taos counties) with FirstHome or HomeForward. Otherwise, NewHome Rate Advantage buys a HomeForward rate down permanently by 1.00% on a newly built, never-occupied, site-built home, while its pilot funding lasts.