Last updated: April 2026 · Program availability changes frequently
Down Payment Assistance in Richmond, VA: Overview
Virginia Housing (formerly VHDA) designed its DPA programs around two specific decisions that explain why Richmond's landscape looks the way it does. First, VHDA made its DPA a true grant, not a deferred second mortgage. This single structural choice separates Virginia from most states: when a Richmond buyer receives VHDA DPA, they never repay it, not at sale, not at refinance, not ever. Second, VHDA created the Granting Freedom program specifically for disabled veterans, a $40,000 accessibility grant that exists in almost no other state. Both decisions reflect a deliberate strategy: remove the permanent debt burden that most DPA programs impose, and build targeted programs for underserved buyer populations. Richmond's DPA landscape is shaped by those choices.
The SPARC program (Sponsoring Partnerships and Revitalizing Communities) exists because Richmond's VHDA affiliate identified a specific affordability gap in targeted city neighborhoods. Moderate-income buyers could qualify for VHDA programs but faced rate environments that pushed monthly payments just out of reach. SPARC reduces the VHDA first mortgage rate by 1 to 2 percentage points in designated census tracts, closing that gap. Combined with the DPA grant, SPARC makes targeted-area purchases meaningfully more affordable than the standard VHDA package. It is a neighborhood-specific tool layered on top of the statewide grant structure.
The City of Richmond operates a separate DHCD program for buyers inside city limits, providing up to $20,000 as a deferred 0% second mortgage forgiven after 10 years. The income limit is more restrictive than VHDA's, capped at 80% AMI. But for buyers who qualify, it stacks directly on top of the VHDA DPA grant, creating a combined assistance package that covers the entire down payment and most closing costs on a typical Richmond city purchase. The city built this program precisely because it saw buyers qualifying for VHDA statewide assistance but still coming up short on the total cash-to-close for city homes.
Quick Answer
Yes. Richmond buyers have access to one of the cleanest DPA structures in the country. The VHDA DPA Grant provides up to 2.5% of the purchase price and requires zero repayment under any circumstances. On a $330,000 Richmond median-price purchase, that is $8,250 in grant funds. City of Richmond buyers can stack the DHCD program for up to $20,000 additional assistance at 0% interest, forgiven after 10 years. The Virginia MCC stacks on top of both for an annual federal tax credit equal to 20% of mortgage interest paid.
Disabled veterans near Fort Gregg-Adams have access to Granting Freedom: a $40,000 accessibility grant that stacks with the VHDA DPA grant and a VA loan. Almost no lenders in the metro proactively mention it.
On a $330,000 purchase using VHDA DPA grant: FHA down payment of $11,550 plus closing costs of roughly $9,900 totals approximately $21,450 needed. The $8,250 VHDA grant covers 38% of that at zero repayment cost. City buyers adding DHCD cover virtually all of it.
Richmond Market Context: Why These Programs Are Structured This Way
VHDA's $126,000 Income Limit: One of the Highest True Grant Limits in the Country
The VHDA DPA Grant income limit of $126,000 for the Richmond MSA is unusually high for a program that requires zero repayment. Most states that offer true grants set income limits at 80% or 100% of AMI, which in Richmond would cut off many moderate and upper-moderate income buyers. VHDA set the limit high enough to cover nearly every first-time buyer in the metro, including dual-income households, government workers, healthcare professionals, and state employees. Richmond's economy is anchored by state government, VCU Health, Bon Secours, defense contractors, and financial services firms. A significant share of the buyer population earns between $80,000 and $126,000. VHDA set the income limit to include them, not exclude them.
The practical effect is that income is almost never the disqualifying factor for VHDA DPA in Richmond. Buyers earning up to $126,000 qualify regardless of household size. This single income limit for all household sizes further simplifies eligibility compared to programs that scale limits by family composition.
Granting Freedom: A $40K Program Almost No One Knows Exists
VHDA Granting Freedom provides up to $40,000 for disabled veterans and surviving spouses to fund accessibility modifications. Most states have no equivalent program. Virginia created it to address a specific gap: disabled veterans often purchase homes that need structural modifications to be safely accessible, and those modification costs frequently exceed what standard DPA programs provide. The $40,000 covers ramps, widened doorways, accessible bathrooms, and other structural changes. The accessibility portion has no income limit. It stacks with the VHDA DPA grant and with a VA loan. Fort Gregg-Adams (formerly Fort Lee), one of the Army's largest installations, sits in Prince George County approximately 25 miles south of Richmond. The metro has a substantial disabled veteran population. Yet most lenders in Richmond have never originated a Granting Freedom loan. Disabled veterans buying in this market should ask for it by name.
City vs. County: Different Programs, Same VHDA Foundation
Richmond city limits and the surrounding counties (Henrico, Chesterfield, Hanover) all have access to statewide VHDA programs. But city limits matter for two programs. The City of Richmond DHCD program applies only within the city, not in Henrico or Chesterfield. The SPARC targeted-rate program applies only in specific city census tracts designated by VHDA. A buyer purchasing in Short Pump (Henrico County) can access VHDA DPA and MCC but not the city DHCD program. A buyer purchasing in Church Hill (city limits) can stack VHDA DPA, city DHCD, and potentially SPARC if the census tract qualifies. Know the jurisdiction before researching the stack.
How DPA Programs Work in Richmond
VHDA True Grant
The VHDA DPA Grant is provided as part of the VHDA first mortgage package. It is not a second mortgage. It is not deferred. It is a grant. The funds are applied at closing toward down payment. No repayment is required when you sell, refinance, or move. The grant requires a paired VHDA first mortgage (FHA or conventional) and VHDA-approved lender origination. The grant amount is 2.5% of the purchase price, calculated on the actual purchase price at closing. There is no clawback provision. It is one of the cleanest DPA structures available to buyers anywhere in the country.
Virginia MCC Tax Credit
The Virginia MCC is not cash at closing. It is a federal tax credit applied annually against your income taxes owed. You pay your mortgage as normal, but 20% of the mortgage interest you pay each year is credited directly against your federal tax liability. On a $330,000 mortgage at 7% interest, year one mortgage interest is approximately $23,100. Twenty percent of that is $4,620 back against taxes owed. The credit declines slightly each year as the loan balance and interest component decrease. The MCC must be applied for at the time of mortgage origination. It cannot be added after closing. It stacks with the VHDA DPA grant. Most buyers who take the DPA grant never apply for the MCC. They are leaving a cumulative five-figure benefit on the table.
City Deferred Second (DHCD)
The City of Richmond DHCD program provides up to $20,000 as a deferred second mortgage at 0% interest. No monthly payment is required during occupancy. The balance is forgiven entirely after 10 years if the buyer remains in the home. If sold or refinanced before 10 years, the outstanding balance is due at that time on a prorated schedule. HUD-approved housing counseling is required before closing. The income limit is 80% AMI, more restrictive than VHDA. For buyers who qualify, this is effectively free money on a 10-year hold period. Combined with the VHDA DPA grant, city buyers can access over $28,000 in combined assistance on a $330,000 purchase.
Check Your Richmond Eligibility
See which Richmond programs you qualify for based on your income, credit score, buyer status, and target area.
Use the Eligibility ToolOpen Programs for Richmond Buyers (2026)
| Program | Type | Amount | Credit | First-Time? | Status |
|---|---|---|---|---|---|
| VHDA DPA Grant | True grant (never repaid) | Up to 2.5% of purchase price | 620 | Conventional: no. FHA: yes (3 yr rule) | Open |
| VHDA SPARC | Below-market rate (targeted areas) | 1-2% rate reduction | 620 | Yes | Verify Open |
| VHDA Granting Freedom | Grant (disabled veterans) | Up to $40,000 | 620 | No income limit (accessibility portion) | Open |
| City of Richmond DHCD DPA | 0% deferred, forgiven 10 yrs | Up to $20,000 | First mortgage std | Yes (80% AMI limit) | Verify Open |
| Virginia MCC | Annual federal tax credit (20%) | ~$4,620/yr on $330K at 7% | 620 | Yes | Open |
| USDA Rural Development | Zero down (eligible areas only) | 100% financing | 640 (USDA guideline) | No | Open |
VHDA programs available at vhda.com through VHDA-approved lenders. City of Richmond DHCD: contact Richmond Department of Housing and Community Development. USDA eligibility: eligibility.sc.egov.usda.gov.
Status legend: Open = available through VHDA-approved lenders, confirm before contracting. Verify Open = locally administered or targeted-area program; confirm current availability and funding before writing an offer.
What Richmond Buyers Are Actually Using in 2026
The Most Common Purchase Paths in the Richmond Metro
Henrico County: $330,000 FHA Purchase
- Purchase price: $330,000
- FHA down payment (3.5%): $11,550
- Closing costs: ~$9,900
- Total needed: ~$21,450
- VHDA DPA Grant (2.5%): $8,250 grant, never repaid
- Net cash from buyer: ~$13,200
- Add MCC: ~$4,620/yr federal tax credit on top
City of Richmond: $280,000 FHA Purchase
- Purchase price: $280,000
- FHA down payment (3.5%): $9,800
- Closing costs: ~$8,400
- Total needed: ~$18,200
- VHDA DPA Grant (2.5%): $7,000 grant
- City DHCD: up to $20,000 (0%, forgiven 10 yrs)
- Combined: $27,000 covers everything with buffer
Richmond DPA Program Details
VHDA Down Payment Assistance Grant
OpenVirginia Housing Development Authority. Statewide.
Key Details
- Up to 2.5% of purchase price as a true grant
- Never repaid under any circumstances
- Paired with VHDA first mortgage (FHA or conventional)
- Income limit: $126,000 (all household sizes, Richmond MSA)
- Minimum credit score: 620
- Conventional option: no first-time buyer requirement
Best For
Any buyer earning under $126,000 who wants grant assistance with no repayment strings attached. The conventional no-first-time-buyer option makes this accessible to move-up buyers and investors returning to owner-occupancy.
vhda.com
VHDA SPARC (Sponsoring Partnerships and Revitalizing Communities)
Verify OpenVirginia Housing Development Authority. Targeted Richmond census tracts.
Key Details
- Below-market interest rate: 1-2% below VHDA standard
- Available only in VHDA-designated census tracts
- Can be combined with VHDA DPA grant
- Minimum credit score: 620
- First-time buyer requirement applies
Best For
Buyers targeting specific Richmond neighborhoods who want both a rate reduction and the DPA grant. The rate reduction can lower monthly payment by $150 to $300 on a typical purchase, on top of the grant assistance at closing.
Check VHDA SPARC map at vhda.com
VHDA Granting Freedom
OpenVirginia Housing Development Authority. For disabled veterans and surviving spouses.
Key Details
- Up to $40,000 grant for accessibility modifications
- No income limit on the accessibility portion
- Stacks with VHDA DPA grant
- Stacks with VA loan
- For disabled veterans and surviving spouses only
- Rare: most states have no equivalent program
Best For
Disabled veterans and surviving spouses purchasing anywhere in Virginia. The Fort Gregg-Adams population in Prince George County creates significant demand in the Richmond metro. Most lenders never mention this program. Ask for it by name on the first lender call.
vhda.com/Buyers/GrantingFreedom
City of Richmond DHCD DPA
Verify OpenRichmond Department of Housing and Community Development. City limits only.
Key Details
- Up to $20,000 deferred second mortgage
- 0% interest, no monthly payment
- Forgiven after 10 years of continuous occupancy
- Income limit: 80% AMI (more restrictive than VHDA)
- HUD-approved housing counseling required
- City of Richmond purchase addresses only
Best For
City buyers at or below 80% AMI who plan to stay at least 10 years. Stacks with VHDA DPA grant for combined assistance exceeding $27,000 on a typical city purchase. The 10-year forgiveness period makes this effectively a grant for long-term owners.
Contact Richmond DHCD to verify availability
Virginia MCC (Mortgage Credit Certificate)
OpenVirginia Housing Development Authority. Statewide.
Key Details
- 20% of annual mortgage interest as federal tax credit
- Not cash at closing: reduces federal taxes owed annually
- Must be applied for at mortgage origination, cannot be added later
- Stacks with VHDA DPA grant
- Income limit similar to VHDA DPA, minimum credit 620
Best For
Any buyer who qualifies for the VHDA DPA grant. The MCC stacks directly with the grant at no additional cost. On a $330,000 mortgage at 7%, the year-one credit is approximately $4,620. Over 10 years, the cumulative tax benefit exceeds $40,000 on a declining basis. Most buyers skip it. They should not.
Apply simultaneously with VHDA mortgage
USDA Rural Development
OpenU.S. Department of Agriculture. Eligible areas only.
Key Details
- Zero down payment (100% financing)
- Parts of Chesterfield, Hanover, and Goochland may qualify
- Richmond city core and inner suburbs generally do not qualify
- Minimum credit score: 640 (USDA guideline)
- No first-time buyer requirement
Best For
Buyers targeting outer suburban or semi-rural addresses in Chesterfield, Hanover, or Goochland who want zero down payment without a VA loan. USDA eligibility is address-specific. Verify at USDA's eligibility map before structuring any offer around USDA financing.
eligibility.sc.egov.usda.gov
VHDA DPA Assistance Range at 5 Price Points
| Purchase Price | VHDA DPA Grant (2.5%) | FHA Down (3.5%) | Est. Closing Costs (~3%) | Total Needed | Net After VHDA Grant |
|---|---|---|---|---|---|
| $240,000 | $6,000 | $8,400 | $7,200 | $15,600 | $9,600 |
| $280,000 | $7,000 | $9,800 | $8,400 | $18,200 | $11,200 |
| $330,000 | $8,250 | $11,550 | $9,900 | $21,450 | $13,200 |
| $380,000 | $9,500 | $13,300 | $11,400 | $24,700 | $15,200 |
| $430,000 | $10,750 | $15,050 | $12,900 | $27,950 | $17,200 |
VHDA DPA grant is never repaid. Closing cost estimate is approximate and varies by lender and transaction. City buyers at 80% AMI can add up to $20,000 DHCD assistance on top, reducing net cash further. City buyers may reach near-zero cash-to-close at $240,000 to $280,000 price points when stacking both programs.
Income Limits for Richmond DPA Programs
| Program | Household Size | Income Limit | Notes |
|---|---|---|---|
| VHDA DPA Grant | All sizes | $126,000 | Single limit for all household sizes in Richmond MSA |
| City of Richmond DHCD | 1 person | ~$52,200 | 80% AMI. More restrictive than VHDA. City limits only. |
| 2 person | ~$59,650 | ||
| 3 person | ~$67,100 | ||
| 4 person | ~$74,500 | ||
| Virginia MCC | All sizes | ~$126,000 | Similar to VHDA DPA. Verify at application. |
| Granting Freedom | All sizes | No limit | Accessibility portion has no income limit |
Income limits are updated annually. Verify current limits with a VHDA-approved lender or at vhda.com before contracting.
Veterans and Military Buyers in Richmond
Fort Gregg-Adams and the $40,000 Nobody Talks About
Fort Gregg-Adams (formerly Fort Lee), one of the Army's largest installations, sits in Prince George County approximately 25 miles south of Richmond. The metro has a large active-duty and veteran population. VHDA Granting Freedom provides up to $40,000 in grant funding for accessibility modifications for disabled veterans and surviving spouses. There is no income limit on the accessibility portion. Most lenders in Richmond have never originated a Granting Freedom transaction. Disabled veterans purchasing in this market should ask for it by name.
This is not a niche edge case. Fort Gregg-Adams generates thousands of transitioning service members annually. A meaningful percentage carry service-connected disabilities. The program exists. It is funded. Almost nobody uses it because almost nobody knows it exists.
VA Loan: The Foundation
- Zero down payment for eligible veterans with full entitlement
- No PMI (VA funding fee instead, often lower cost)
- VHDA DPA grant can cover closing costs on VA loans
- No FHA loan limit issues: VA has no loan limit for full entitlement
- $546,250 FHA limit does not restrict VA buyers
Granting Freedom Stack
- Up to $40,000 for accessibility modifications
- Stacks with VA loan (zero down)
- Stacks with VHDA DPA grant (covers closing costs)
- No income limit on the accessibility portion
- VHDA Military Enhancer option: rate reduction for military buyers
- Ask your lender: "I want Granting Freedom. Can you originate it?"
Disabled Veteran Stack at $380,000
VA loan: zero down payment. VHDA DPA grant (2.5%): $9,500 toward closing costs. Granting Freedom: up to $40,000 for accessibility modifications. Total potential benefit: $49,500 in grants plus zero down payment. Net cash from buyer: near zero, with modifications funded.
This stack is available today. Most disabled veterans buying near Richmond do not know it exists.
Are You a Veteran Buying Near Richmond?
Use our eligibility tool to explore the VA loan plus Granting Freedom plus VHDA DPA combination for your purchase.
Check Veteran EligibilityHow to Apply for Richmond DPA Programs
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1
Confirm your target area
Determine whether you are buying inside Richmond city limits or in Henrico, Chesterfield, or Hanover. City address: VHDA DPA plus city DHCD are both available. County address: VHDA DPA and MCC available, city DHCD is not. This distinction drives your program stack before you contact a lender.
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2
Find a VHDA-approved lender
VHDA DPA requires origination through a VHDA-approved lender. Not all lenders are VHDA-approved. Search the VHDA lender directory at vhda.com. If you are a veteran seeking Granting Freedom, confirm the lender has originated Granting Freedom transactions before. Many VHDA-approved lenders have never done one.
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3
Tell the lender all programs you want
On the first call, explicitly request: VHDA DPA grant, Virginia MCC, and Granting Freedom if applicable. The MCC especially must be applied for simultaneously with the mortgage. It cannot be added after loan submission. State it on your first call: "I want the VHDA DPA grant and the Virginia MCC in my loan package."
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4
Complete HUD counseling if required
The City of Richmond DHCD program requires HUD-approved housing counseling before closing. VHDA programs do not universally require counseling but some products may. Schedule counseling early. It typically takes 8 to 10 hours and must be completed before the loan can close. Look for HUD-approved agencies in the Richmond area at hud.gov/counseling.
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5
Verify SPARC eligibility if buying in a targeted area
If your target property is in a VHDA SPARC-designated census tract, ask your lender to confirm the rate reduction applies before writing an offer. The SPARC rate reduction does not apply to all VHDA-financed properties. The lender can confirm census tract eligibility with the property address.
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6
Contact city DHCD directly for city purchases
The City of Richmond DHCD program is administered by the city, not VHDA. Verify current funding availability and application procedures by contacting the Richmond Department of Housing and Community Development directly before structuring your offer around city assistance. Funded programs have cycles and may temporarily close to applications.
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7
Get the grant confirmation in writing before contracting
Before writing an offer that depends on DPA, get written confirmation from your lender that your specific scenario qualifies for the programs you are counting on. Program stacking, income eligibility, and property eligibility should all be confirmed in writing before you are under contract.
Can You Combine Richmond DPA Programs?
The Three-Way Stack for City Buyers
Layer 1: VHDA DPA Grant. 2.5% of purchase price as a true grant. Never repaid. Applied to down payment at closing.
Layer 2: City of Richmond DHCD. Up to $20,000 at 0% interest, forgiven after 10 years. Applied to remaining down payment and closing costs. Requires 80% AMI eligibility and city address.
Layer 3: Virginia MCC. 20% of annual mortgage interest as a federal tax credit. Not cash at closing, but reduces federal taxes owed every year. Must be applied for with the mortgage. Stacks with both Layer 1 and Layer 2.
Combined impact on a $280,000 city purchase: $7,000 VHDA grant plus $20,000 city DHCD equals $27,000 in combined assistance at closing. MCC adds approximately $3,920 in year-one federal tax savings on top. Total first-year benefit: over $30,900.
Stacking rule: Never assume programs stack without confirming with your lender. The VHDA DPA grant and MCC stack is well-established. The city DHCD stack with VHDA requires lender confirmation that both second-lien structures are compatible with your first mortgage. Get written stacking confirmation before writing an offer that depends on both city and VHDA assistance.
4 Common Mistakes Richmond Buyers Make
Mistake 1: Assuming VHDA DPA Must Be Repaid
Most buyers assume all DPA is a loan that comes due when they sell or refinance. VHDA DPA is a true grant with zero repayment obligation under any circumstances. Buyers who hear "assistance" and assume "loan" are underestimating the actual value of the program. The grant does not encumber title. It does not create a second lien. It is paid at closing and never due again.
Mistake 2: Taking the DPA Grant Without Asking About the MCC
The Virginia MCC stacks directly with the VHDA DPA grant. Both go through VHDA-approved lenders. Both are applied for simultaneously. The MCC adds approximately $4,620 in year-one federal tax savings on a $330,000 mortgage. Over 10 years, the cumulative benefit exceeds $40,000 on a declining basis. Most Richmond buyers take the grant and never ask about the MCC. One question on the first lender call captures a five-figure long-term benefit. Ask: "Can I also apply for the Virginia MCC?"
Mistake 3: Disabled Veterans Missing Granting Freedom
VHDA Granting Freedom provides up to $40,000 for disabled veterans. Most lenders in Richmond have never originated this loan. Disabled veterans who do not ask for it by name will not receive it. The program has no income limit on the accessibility portion. It stacks with a VA loan and with the VHDA DPA grant. A disabled veteran who closes without asking about Granting Freedom may have left $40,000 in grant funding unused.
Mistake 4: City Buyers Not Using Both VHDA and City DHCD
Buyers purchasing within Richmond city limits who qualify at 80% AMI have access to both the VHDA DPA grant and the City of Richmond DHCD program simultaneously. Many use only the VHDA program because their lender handles VHDA and does not mention the city program. The city DHCD program adds up to $20,000 in 0% assistance forgiven after 10 years. On a $280,000 city purchase, the combined stack covers virtually the entire cash-to-close requirement.
Three Richmond Buyer Scenarios
Scenario 1: First-Time Buyer in Henrico County
Buyer Profile
- Purchase price: $330,000 (Henrico County)
- Credit score: 640
- Income: $90,000
- First-time buyer: yes
Programs Used
- VHDA DPA Grant: $8,250 (never repaid)
- FHA first mortgage with VHDA
- Virginia MCC: ~$4,620/yr federal tax credit
- Net cash-to-close: approximately $13,200
- Year-one total benefit: $8,250 grant plus $4,620 MCC = $12,870
Scenario 2: City of Richmond Buyer in Church Hill
Buyer Profile
- Purchase price: $280,000 (Church Hill, city limits)
- Credit score: 650
- Income: $58,000 (2-person household, 80% AMI)
- First-time buyer: yes
Programs Used
- VHDA DPA Grant: $7,000 (never repaid)
- City of Richmond DHCD: $20,000 (0%, forgiven at 10 yrs)
- Total assistance: $27,000
- Total needed (FHA + closing costs): ~$18,200
- Net cash from buyer: near zero with buffer
Scenario 3: Disabled Veteran Buying Near Fort Gregg-Adams
Buyer Profile
- Purchase price: $380,000 (Chesterfield County)
- Service-connected disability: yes
- VA loan eligible: full entitlement
- First-time buyer: not required for Granting Freedom
Programs Used
- VA loan: zero down payment
- VHDA DPA Grant: $9,500 toward closing costs
- Granting Freedom: up to $40,000 for accessibility mods
- Total grants: up to $49,500
- Net cash from buyer: near zero. Accessibility funded.
Frequently Asked Questions: Richmond VA DPA
How much down payment assistance is available in Richmond, Virginia?
Is VHDA's DPA a grant or a loan?
What is the income limit for VHDA DPA in Richmond?
Can I use both the VHDA grant and the MCC at the same time?
What is Granting Freedom and who qualifies?
Can I use VHDA DPA with a VA loan?
What is the difference between the VHDA grant and the City of Richmond DHCD program?
Does USDA apply in the Richmond metro area?
What is the SPARC program and where does it apply?
Do I need to be a first-time buyer for VHDA DPA in Richmond?
Ready to See What You Qualify For in Richmond?
Use our free eligibility tool to find the programs that match your income, credit, buyer status, and target area in the Richmond metro.
Check Your EligibilityRelated Pages
This guide is for informational purposes only and is not a commitment to lend. Program availability, terms, and eligibility requirements change frequently. VHDA program details including income limits, grant percentages, and product availability are updated by Virginia Housing and subject to change. City of Richmond DHCD program is subject to city funding cycles and may not be accepting applications at the time you read this page. USDA eligibility is address-specific and map boundaries change periodically. All program details should be verified directly with Virginia Housing at vhda.com, the City of Richmond Department of Housing and Community Development, or a VHDA-approved lender before making financial decisions. DownPaymentScout is an independent resource and is not affiliated with any government agency or lending institution. Information is believed accurate as of the date shown but is not guaranteed. Last updated April 2026.