How First-Time Homebuyer Grants Work in Colorado

Lauren sits down with Marc Emrich, Senior Loan Originator at Pivot Lending Group, to break down how first-time homebuyer grants actually work in Colorado — including the difference between true grants, forgivable loans, and deferred loans, and what the residency requirements really mean. They also cover who qualifies, how the application process works, and what to watch out for when something sounds too good to be true. Listeners will come away with a clearer picture of their options and a better sense of where to start. Home Base is a weekly podcast from Pivot Lending Group helping first-time homebuyers understand the mortgage process, available assistance programs, and what to expect on the road to ownership. 🌐 Resources in English & Spanish: https://cofirsttimebuyergrants.com/

https://cofirsttimebuyergrants.com/

Transcript

SPEAKER_01 0:00

Welcome to Home Base, the podcast that helps first-time homebuyers understand the road to owning their own home. I am your host, Lauren, and every week I'm joined by Mark Emmerich, Senior Loan Originator at Pivot Lending Group. Let us get into it. Mark, welcome back. Always good to have you in the chair.

SPEAKER_00 0:17

Thanks, Lauren. Glad to be here. It's a great morning for a conversation.

SPEAKER_01 0:21

Today we're talking about home buyer grants in Colorado, what they actually are, how they work, and whether they're as good as they sound for someone buying their first home. So, Mark, I have to be honest, when I first heard the phrase homebuyer grant, my reaction was basically that can't be real, is it?

SPEAKER_00 0:39

It's a really common reaction and honestly a healthy one. Skepticism is smart when something sounds too good to be true. But legitimate homebuyer assistance programs do exist in Colorado, and some of them are structured as true grants, meaning if you meet the program requirements and stay in the home for the required period, you don't pay that money back. The key word there is legitimate, and we'll talk about how to make sure you're working with the real thing.

SPEAKER_01 1:05

Okay, so you said stay in the home for the required period. What does that mean exactly?

SPEAKER_00 1:10

Most grant programs come with a residency requirement, which is basically the program's way of ensuring the assistance goes to people who are actually going to live in the home as their primary residence. If you sell or refinance before that period ends, you may be required to repay some or all of the assistance. The length of that requirement varies by program, so it's one of the first things your mortgage professionals should walk you through before you accept any assistance.

SPEAKER_01 1:36

That makes sense. Now you also mentioned that some programs are structured as grants and some aren't. Can you break that down a little?

SPEAKER_00 1:43

Sure, and this is actually really important to understand before you sign anything. A true grant doesn't need to be repaid if you meet the terms. Then there's something called a forgivable second mortgage, which starts out as a loan but is gradually forgiven the longer you stay in the home, often reaching full forgiveness after a set number of years. And then there's a deferred second mortgage, which is repaid when you eventually sell, refinance, or move out. All three can help you get into a home, but they work differently and knowing which one you're receiving matters.

SPEAKER_01 2:13

So a forgivable second mortgage. That one kind of functions like a grant if you stay long enough?

SPEAKER_00 2:19

Exactly right. If you remain in the home through the forgiveness period, you never have to pay it back. It just goes away. That's why a lot of people describe it as grant style assistance. Even though it technically starts as a loan, the practical outcome for a buyer who stays put is the same as a grant. The distinction matters most if your plans change and you need to sell or refinance early.

SPEAKER_01 2:40

Got it. So who actually qualifies for this kind of assistance? I'm guessing it's not available to everyone.

SPEAKER_00 2:46

Correct. There are eligibility requirements, and they typically look at a few things: your income relative to the area's limits, the purchase price of the home, your credit score, and your status as a first-time buyer. That first-time buyer definition is worth knowing. Most programs define it as not having owned a home in the past three years, so even if you've owned before, you may still qualify. Many programs also require you to complete a home buyer education course, which is actually a great resource on its own.

SPEAKER_01 3:17

Oh, interesting. So someone who owned a home years ago could still potentially qualify as a first-time buyer under these programs?

SPEAKER_00 3:24

In many cases, yes. The three-year rule is pretty standard, so if you haven't owned a primary residence in the last three years, a lot of programs will consider you a first-time buyer for their purposes. It's one of those things that surprises people. And it opens the door for buyers who assume they've aged out of this kind of help.

SPEAKER_01 3:43

Okay, so let's say I think I might qualify. How do I actually access one of these programs? Do I apply directly to the state or a government office?

SPEAKER_00 3:52

This is one of the most common misconceptions. You don't apply directly to a government agency. Home buyer grant assistance is accessed through participating lenders. So the process starts when you sit down with a licensed mortgage professional who works with these programs regularly. They'll review your eligibility, match you to programs that fit your situation, and build any assistance into your overall loan structure. The earlier in the process you have that conversation, the more options you have to work with.

SPEAKER_01 4:20

That's really useful to know. What about the legitimacy question? How does a buyer make sure they're not being misled by something that looks like a grant program but isn't?

SPEAKER_00 4:29

The clearest red flag is anyone asking for upfront fees to access a grant program. Legitimate assistance programs don't work that way. Working with a licensed mortgage professional who has direct hands-on experience with these programs is your best protection. They'll be transparent about exactly how each program works, what the terms are, and what you're committing to. If something feels off or unclear, it's okay to ask more questions. A good professional will welcome that.

SPEAKER_01 4:55

One more thing.

SPEAKER_00 5:08

Tax treatment can vary, so it's worth having a conversation with a tax professional about your specific situation. Your mortgage professional can help you know what questions to bring to that conversation, but the tax piece really does need its own expert.

SPEAKER_01 5:21

Mark, if someone's listening to this and they're going to walk away with one thing, what should it be?

SPEAKER_00 5:26

Don't assume you don't qualify before you've had the conversation. A lot of buyers rule themselves out without ever asking, and the eligibility requirements, especially around that first-time buyer definition, are more flexible than most people expect. Start the conversation early with a mortgage professional who knows these programs because that's where the real picture comes into focus.

SPEAKER_01 5:48

Mark, thank you. This was genuinely eye-opening. And I think a lot of people are going to hear this and realize they have more options than they thought. We'll see everyone back here next week on Home Base. That's it for this week's Home Base. If you want to learn more about home buyer programs and resources, visit cofirsttime buyergrants.com. You'll find everything in English and Spanish. We're back next week. Thanks for listening.