I
n 2024, Diana Muro became a homeowner at age 27 and achieved another milestone: she was the first in her family to buy a home. Her parents, Mexican immigrants, had always rented due to financial struggles and uncertainty about their future in the US. To overcome these challenges, Muro combined down payment assistance from city, state, and nonprofit programs totaling $100,000 with a personal contribution of around $35,000.
As home prices continue to rise and the racial homeownership gap persists, it's essential to address the hurdles faced by first-generation buyers. These individuals often lack generational wealth and experience navigating the complex process of buying a home. According to Bankrate's 2025 Down Payment Survey, over half (52%) of prospective homebuyers consider coming up with a down payment and closing costs a significant obstacle.
To support first-generation buyers, some states have introduced subsidies and programs. For example, California offers up to $150,000 through the California Dream for All Shared Appreciation Loan, while Minnesota funded a First-Generation Homebuyer Loan Program in 2024. Massachusetts also provides down payment assistance with income limits ranging from $45,000 to $60,000.
To qualify as a first-generation buyer, borrowers must meet specific criteria, including not having had any ownership interest in a home during the previous three years and not having a parent with an ownership interest in a property within that timeframe. Policymakers aim to address ongoing racial disparities in wealth and homeownership by targeting first-generation buyers.
To overcome these challenges, prospective homebuyers should focus on building their credit score, examining their financial situation, and doing their homework on available programs. Getting preapproved for a mortgage and shopping around for the best rates and deals can also make a significant difference. By taking these steps, first-generation buyers can increase their chances of achieving homeownership despite the obstacles they face.
