Overview
Vermont's typical home runs about $394,000, and tight inventory across the state's small towns means buyers often compete hard for the few listings that appear. Your guide here is the Vermont Housing Finance Agency (VHFA), a state body that has helped Vermonters into first homes since the 1970s. The real challenge isn't your monthly payment so much as the cash to close: down payment plus closing costs in a state with high property taxes. The good news is that VHFA pairs a competitive first mortgage with down payment help designed exactly for that hurdle.
VHFA's flagship help is the ASSIST down payment and closing-cost program. It's a 0% interest, non-amortizing second mortgage with no monthly payments — you only repay it when you sell the home, refinance, or pay off the first mortgage. The current maximum is $10,000, and it's available only when you use a VHFA first mortgage like MOVE. You must be a true first-time homebuyer (no ownership in the past three years), and your combined liquid assets must stay under $20,000. One honest caveat for 2026: ASSIST is funded by state housing tax credits that are running low, so VHFA has been seeking new funding to keep it open — ask your lender to confirm availability before you count on it.
State Programs
VHFA ASSIST Down Payment & Closing Cost Program
Deferred 0% second mortgage (non-amortizing; repaid at sale, refinance, or payoff)First Generation Homebuyer Grant
Grant (never repaid)MOVE MCC (Mortgage Credit Certificate)
Federal mortgage interest tax credit (annual, for life of loan)City of Burlington Down Payment Assistance (multi-unit)
Deferred 0% loanChamplain Housing Trust Shared-Equity / Homeownership Equity Program
0% down payment loan (HEP) and shared-equity / community land trust homesFederal Programs Available in Vermont
These nationwide programs can be combined with Vermont state assistance for maximum benefit.
FHA Loan Program
Low down payment mortgageVA Home Loan
Zero down payment mortgageUSDA Rural Development Loan
Zero down payment mortgageTips for First-Time Buyers in Vermont
VHFA also runs the First Generation Homebuyer grant: a $15,000 grant (true grant, never repaid) for buyers whose parents or guardians never owned a home, lost one to foreclosure, or who spent time in foster care. It can stack on top of ASSIST for up to roughly $25,000 in combined help, and pairs with VHFA's MOVE MCC, a Mortgage Credit Certificate that turns part of your annual mortgage interest into a federal tax credit year after year. Locally, the City of Burlington offers a deferred 0% loan of up to $10,000 toward owner-occupied multi-unit homes where you live in one unit.
Vermont has a graduated income tax from 3.35% up to 8.75%, and its property taxes are among the nation's highest — an effective rate near 1.51% of home value. On a $394,000 home, that's roughly $5,900 a year, so build it into your budget alongside the mortgage. The bright spot: Vermont's Homestead Declaration lowers the education-tax portion of your bill on your primary residence, and income-based property tax credits help eligible owners earning under about $115,000. File your Homestead Declaration every year you live in the home — it's not automatic, and missing it bumps you to the higher nonhomestead rate.
Beyond state programs, the Champlain Housing Trust in northwest Vermont runs a shared-equity (community land trust) model that cuts your purchase price in exchange for resale limits, plus a Homeownership Equity Program offering 0% loans up to $25,000 for income-qualified buyers. If you serve at the Vermont Air National Guard base in South Burlington (home to the F-35 fleet), VA loans pair cleanly with VHFA help. Smart next steps: take a HUD-approved homebuyer education course (VHFA requires one for its loans), then connect with a HUD-approved housing counselor to map out which combination of programs fits your situation.
Frequently Asked Questions
For educational purposes only -- not financial or tax advice. Program details, eligibility requirements, and benefit amounts are subject to change. Verify all information directly with the administering agency before applying. Last verified: June 15, 2026.