First-time home buyer programs in New York: assistance, loans and real costs

New York is the rare state where a first-time buyer’s biggest government closing cost is a tax on the mortgage itself — the mortgage recording tax — which SONYMA loans do not waive but co-op purchases sidestep entirely. Everything else on this page — the agency programs, the tax credit, the closing costs — sits on top of that fact.

State housing agency	New York State Homes and Community Renewal (HCR) / SONYMA
Median home price (approx.)	$480,000 — statewide order of magnitude; metros differ
3.5% / 5% / 20% down	$16,800 / $24,000 / $96,000 on the median
Property tax (effective)	about 1.4% — roughly $6,720 a year on the median
Mortgage credit certificate	Not consistently offered — ask a lender
Transfer tax	New York’s state transfer tax is $2 per $500 (0.4%), paid by the seller; New York City adds 1% to 1.425% (seller), and buyers pay the “mansion tax” of 1% and up on purchases of $1 million or more.

New York’s first-time buyer programs

The State of New York Mortgage Agency (SONYMA), part of Homes and Community Renewal, offers the Achieving the Dream (lower-income) and Low Interest Rate programs to first-time buyers, each combinable with the Down Payment Assistance Loan (DPAL); Give Us Credit expands underwriting for non-traditional credit. New York City adds HomeFirst for city buyers.

The down payment help, and how it must be repaid

DPAL provides the greater of $1,000 or 3% of the price up to $15,000 as a 0% second forgiven after ten years; DPAL Plus offers up to $30,000 for lower-income buyers in certain programs. NYC’s HomeFirst provides up to $100,000 for qualifying city buyers.

Every assistance dollar comes in one of four shapes — grant, forgivable, deferred or repayable — and the shape decides what it costs you over ten years. Get it in writing before you apply. See how down payment assistance programs work.

Tax credit for first-time buyers

SONYMA does not currently issue Mortgage Credit Certificates; ask a SONYMA-participating lender about other subsidies.

Income and purchase price limits

SONYMA income limits vary by county and household size (highest downstate) and purchase price limits apply, with higher limits in targeted areas where first-time status is waived; a 620 minimum credit score and homebuyer education are required.

Transfer taxes and closing costs in New York

New York’s state transfer tax is $2 per $500 (0.4%), paid by the seller; New York City adds 1% to 1.425% (seller), and buyers pay the “mansion tax” of 1% and up on purchases of $1 million or more. Buyers also pay mortgage recording tax of about 0.8% to 1.925% of the loan depending on the county.

New York buyers face the mortgage recording tax, attorney fees, title insurance and, in the city, high closing costs all around — commonly 3% to 5% of the price downstate, 2% to 3% upstate. Co-op purchases avoid the mortgage recording tax and title insurance. Our guide to closing costs explains each line of the Loan Estimate and which fees you can shop.

Worked example: buying the median home in New York

On a home at New York’s rough median of $480,000, here is what the three standard first-time structures look like at an illustrative 6.5% rate — principal and interest only, before homeowners insurance and any mortgage insurance. The tax column uses the state’s approximate effective rate of 1.4% (about $6,720 a year on this price). Neither number is an offer; both are the right order of magnitude for a budget.

Structure	Down payment	Loan amount	P&I at 6.5% (30 yr)	Property tax / mo (est.)
FHA, 3.5% down	$16,800	$463,200	$2,928	$560
Conventional, 5% down	$24,000	$456,000	$2,882	$560
Conventional, 20% down (no PMI)	$96,000	$384,000	$2,427	$560

Illustrative rate and approximate state figures — not an offer or a quote. Full payment tables cover $150,000 to $800,000 at 5% to 8%; the affordability guide explains how lenders size the loan.

Frequently asked questions

Does New York have down payment assistance for first-time buyers?

DPAL provides the greater of $1,000 or 3% of the price up to $15,000 as a 0% second forgiven after ten years; DPAL Plus offers up to $30,000 for lower-income buyers in certain programs. The agency publishes the current limits and amounts; a lender approved for the program will know them.

Is there a first-time home buyer tax credit in New York?

SONYMA does not currently issue Mortgage Credit Certificates; ask a SONYMA-participating lender about other subsidies. MCCs reduce federal income tax owed each year for as long as you keep the loan and live in the home; they are applied for through the lender at purchase.

What are typical closing costs when buying a house in New York?

New York buyers face the mortgage recording tax, attorney fees, title insurance and, in the city, high closing costs all around — commonly 3% to 5% of the price downstate, 2% to 3% upstate. Co-op purchases avoid the mortgage recording tax and title insurance. New York’s state transfer tax is $2 per $500 (0.4%), paid by the seller; New York City adds 1% to 1.425% (seller), and buyers pay the “mansion tax” of 1% and up on purchases of $1 million or more.